What is Gap Insurance?

car insurance

When buying a new Mercedes-Benz, you’ll want to make sure your vehicle has the appropriate coverage. This means you’ll have to look over various options in terms of financing and insuring your car. Of the many optional insurance coverages, there’s gap insurance. So, what does gap insurance do? Gap insurance is designed to cover the gap between the owed amount on the car and the true cash value of the car at the time of an accident. Learn more about how gap insurance works and what it covers at Mercedes-Benz of Newton.

What Does Gap Insurance Cover?

While gap insurance does cover a variety of issues related to your vehicle, it doesn’t cover property or bodily injuries. With that, here’s exactly what gap insurance does and does not, cover:

Gap Insurance Covers:

  • Theft
  • Fire
  • Vandalism
  • Accident
  • Acts of nature (tornado, hurricane, flood, etc.)

Gap Insurance Does NOT Cover:

  • Deductible (though some gap insurance policies allow this)
  • Engine failures and other mechanical repairs/malfunctions
  • Death
  • Extended warranties

The main takeaway from the question ‘what does gap insurance do,’ is that it’s meant to cover total loss in the event of an accident. Though it’s an optional coverage for Hackettstown and Sussex drivers, it’s worth talking with your insurance company about what it offers you.

Do I Need Gap Insurance?

No, it’s not a required insurance. However, it’s highly recommended that you opt for gap insurance when purchasing a new car, as a totaled car could prove quite costly. Gap insurance is also especially helpful if your dealership offers a plan that includes deductible coverage, which will equate to even more savings. Speak with our financing team to discuss the advantages of gap insurance, and whether it’s worth adding to your insurance arsenal.

Explore All Insurance and Finance Options at Mercedes-Benz of Newton

Whether you’re just beginning the car search, or are ready to make a purchase, it helps to be informed of your insurance options. Make sure you understand exactly what you need, and want, before purchasing a car. The right coverage can save you time and money down the road. Pay us a visit, or contact us online to find out more!

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    Mercedes-Benz of Newton
    Mercedes-Benz of Newton
    92 Hampton House Rd
    Newton, NJ, 07860 United States
    Mercedes-Benz of Newton 41.0792303, -74.736367.