Vw Leases: Gap Insurance Included?

Volkswagen Credit leases come with Guaranteed Asset Protection (GAP) insurance included. This means that if your car is written off, GAP insurance will cover the difference between your car insurance settlement and the remaining car loan or lease balance. This also applies to natural disasters, accidents, and theft. GAP insurance is optional and not required in the state of Missouri, but it is worth considering for added protection and peace of mind.

VW lease deals include GAP insurance

When you lease a Volkswagen vehicle, you can rest assured that GAP insurance is included in your lease deal. This is a valuable addition to your lease, as it offers financial protection in case your vehicle is written off or stolen.

Guaranteed Asset Protection (GAP) insurance, also known as Guaranteed Auto Protection, is designed to cover the difference between the insurance settlement you receive for a total loss of your vehicle and the remaining balance on your lease. This can include situations where your vehicle is stolen or written off due to an accident or natural disaster.

When you lease a vehicle, you are responsible for the depreciation of the vehicle's value over the lease period. In the unfortunate event of a total loss, GAP insurance ensures that the remaining balance on your lease is covered, so you don't have to pay out of pocket.

Benefits of GAP Insurance

GAP insurance provides peace of mind and financial protection in case of unforeseen events. It is especially valuable when leasing a new vehicle, as the risk of owing more than the vehicle's value is higher during the initial years of ownership.

While GAP insurance is not required by law, it is a highly recommended form of coverage to have. It is worth noting that GAP insurance is included in all VW lease deals, so you can benefit from this added protection without any additional cost or effort.

When you lease a Volkswagen vehicle, GAP insurance is automatically included as part of your lease agreement. This means that in the event of a total loss, your lease provider will be paid off, even if your insurance does not cover the full balance. This protection is a standard benefit offered by VW to its leasing customers.

GAP insurance covers acts of nature

Volkswagen Guaranteed Asset Protection (GAP) insurance is included in all VW Credit leases. This insurance covers the difference between the insurance settlement you would get for a totalled car and the remaining loan or lease balance. This includes protection against financial losses from theft and accidents, as well as acts of nature or natural disasters.

Acts of nature, also known as acts of God, refer to natural disasters that cannot be foreseen or prevented by humans. This includes hurricanes, lightning strikes, earthquakes, tornados, hail, windstorms, floods, and volcanic eruptions. These events are considered to be direct results of natural causes, where no blame can be assigned to any person.

While GAP insurance from Volkswagen is convenient, it is often more expensive than getting similar coverage from your regular insurance company. Most major insurance providers offer comprehensive coverage that includes protection against acts of nature. This type of coverage is typically referred to as Act of God insurance and is designed to protect drivers from financial losses caused by natural disasters.

It is important to carefully review the terms and conditions of your insurance policy to understand what is covered and what exclusions may apply. By understanding the specifics of your coverage, you can ensure that you are adequately protected in the event of an act of nature or any other unforeseen circumstance.

GAP insurance doesn't cover mechanical repairs

While GAP insurance is a valuable addition to your car insurance, it does not cover mechanical repairs. Mechanical failures or repairs are not covered, even if the repair costs exceed the vehicle's value. This means that engine or transmission failures, for instance, would not be covered by GAP insurance.

GAP insurance is designed to cover the difference between the actual cash value of your vehicle and the outstanding loan or lease balance in the event of a total loss. This can occur due to an accident, theft, or natural disaster. It ensures that you are not left with a large bill to pay off the remaining value of your car.

For example, if your vehicle is deemed a total loss and your insurance company pays out $13,500, but your loan balance is $17,000, GAP insurance would cover the $3,500 difference. It may also cover your deductible, up to a certain amount.

While it is not mandatory, GAP insurance is often included in lease deals, such as with VW leases, and can provide valuable peace of mind. However, it is important to note that it does not cover mechanical repairs or issues.

If you are considering GAP insurance, it is recommended to compare rates and offerings from different providers, as it may be more cost-effective to obtain GAP insurance through your regular car insurance provider rather than a dealership.

GAP insurance is optional

When you lease a car, you are essentially paying for the depreciation of the vehicle's value over a set period. In the event of a total loss, GAP insurance will make sure that your loan provider is paid off even if your insurance does not cover the full balance. This also applies to natural disasters, accidents, and theft. There is no maximum dollar amount on covered losses, and it includes a waiver of up to $1,000 for your primary insurance deductible.

You can get GAP insurance from your auto insurance company, your auto loan lender or dealership, or an insurance company that focuses solely on GAP insurance. It is usually cheaper to get it through your regular car insurance provider. Volkswagen dealerships charge between $400 and $700 to add GAP to your loan or lease contract when buying a new vehicle, whereas you can get GAP protection from your current auto insurance company for around $20 per year.

GAP insurance is low-cost

Why GAP Insurance is Low-Cost

GAP insurance, or Guaranteed Asset Protection insurance, is an optional, additional coverage that pays the difference between the amount covered by your regular insurance and the amount you owe on your car loan in the event of theft or a total loss. While it is not required by state law, it is often required by lenders and lessors.

Low-Cost Insurance

When to Choose Low-Cost GAP Insurance

Low-cost GAP insurance from an insurance provider is a good option if you are the original owner of the vehicle and the car is no more than two to three years old.

When GAP Insurance May Cost More

If you are leasing a car or have a car loan, and you made a low down payment (typically defined as less than 20%), then you will need GAP insurance. In this case, GAP insurance may be more expensive as it is usually required as part of your lease contract.

When You Don't Need GAP Insurance

If you don't have a car loan or lease, then you don't need GAP insurance. GAP insurance is also unnecessary if your loan is paid down below the value of your car.

The Benefits of GAP Insurance

GAP insurance gives you peace of mind and protects you from a big expense if your car is stolen or totaled. It is especially beneficial if you have made a small down payment, have a long-term loan, or your car depreciates in value quickly.

The Bottom Line

Frequently asked questions