What is better for a new Mitsubishi, gap insurance or new car replacement insurance?

I just bought a new Mitsubishi Lancer and my car insurance offers gap or new car replacement insurance. What do these actually cover?

Apr 30, 2021
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Emily Maracle
Answered at Apr 30, 2021
“Since a new vehicle’s value depreciates quickly, new car replacement insurance ensures that if your vehicle is totaled, you’ll be reimbursed with enough money to get a car of a similar make/model. Coverage can vary, with some policies offering the option to repair the vehicle instead of replacing it.
When deciding what’s best for your vehicle, it’s important to look at the bigger picture. Gap insurance covers any difference between the amount you owe on your loan and the actual cash value of your vehicle (original price minus depreciation).
If your vehicle was totaled tomorrow, would you be able to pay off your loan? Or would you experience financial hardship?
If you wouldn’t have an issue paying off your loan, new car replacement insurance may be a better option for you as you’ll be able to get into a new vehicle faster.
Gap InsuranceCar InsuranceMitsubishi
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