New car replacement and GAP insurance coverage guide
If you have an accident in your new car, your insurance coverage (after your deductible) may not cover the full cost of replacing your vehicle or the initial loan you took out to buy the car. That’s where new car replacement insurance and guaranteed auto protection (GAP) coverage come in.
Here are two examples to help explain:
What is new car replacement coverage?
New car replacement coverage lets you replace your vehicle with the same make and model at a total price of up to 110 percent of the Manufacturer’s Suggested Retail Price — within the first year of ownership or within the first 15,000 miles.
What is GAP insurance coverage?
GAP coverage may pay the difference between the value of your vehicle and the amount of your original loan. This coverage extends to 120 percent of your vehicle’s value. GAP coverage includes new car replacement coverage for the first year of ownership and then offers additional protection for the next two years.