Do I need gap insurance for a new 2020 Nissan Maxima?
I didn't need to put any money down at signing and my loan term is for 72 months. I'm being offered an affordable price for gap insurance. Do I need to add it?
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Answered on May 03, 2021
Emily Maracle is a car insurance specialist living in New York. Originally from the Pacific Northwest, she has a degree in English Literature and a background in customer service. She enjoys cooking, gardening, and living sustainably. In the future, she can't wait to upgrade to a hybrid or electric car.
“You should look at the current value of your vehicle and the amount you owe on your loan. If you currently owe more on your loan than your vehicle is worth, you should add gap insurance.
Gap insurance is often recommended for longer-term loans, as your new vehicle can depreciate significantly within the first year of ownership. If the actual cash value (original price minus depreciation) ends up being less than what you owe, gap insurance would cover the difference.
In the future, if you decide you no longer want or need gap insurance, you will typically be able to cancel it without a penalty. “
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