Imagine you just bought a 2017 Audi A3 and you’re excited to show it off to all of your friends. You head home to pick up a few things and you see someone else driving your brand-new car down the street. You alert the authorities immediately, followed by your insurance company. The police find your vehicle a few days later, but it’s badly damaged. You file a claim with your insurance provider and the company declares your vehicle a total loss.
While you’d be devastated by the news, you would be at risk for another shock if you didn’t have gap insurance. That’s because you’d be responsible for paying the difference between the balance of your car loan and the amount your insurance provider compensates you. This means you’d need to pay $3,000 out of pocket if you owe $27,000 on your car and your insurer only reimburses you for $24,000.
If you had gap insurance, you wouldn’t have to pay the difference between your remaining loan balance and the amount your insurance company provides. That’s because gap insurance is a kind of car insurance policy that literally pays the “gap” between the amount your insurer pays and the amount of your outstanding car loan if your automobile is declared a total loss as the result of an accident or theft.
While it’s obvious that there is value to having gap insurance if you’ve just purchased a vehicle and put very little money down, getting this type of coverage isn’t the right move for everyone. If you’ve already paid off your car, for instance, there is no need for you to get gap insurance. If your loan balance is small, you probably don’t need to get a gap insurance policy either.
Just like gap insurance is a wise investment for many drivers, you’ll see that getting one of our Audi vehicles is also a good investment when you visit our Los Angeles Audi dealership on Van Nuys Boulevard. If you want to see what it’s like to have a new luxury automobile in your driveway, visit Keyes Audi today.