What is Gap Inusrance and how does it help you?

GAP insurance can provide valuable protection during the early years of your car’s life if you have a loan or a lease.

If a loss occurs, GAP insurance will pay the difference between the actual cash value of the vehicle and the

current outstanding balance on your loan or lease. Gap Insurance protects your vehicle lease or loan.

Sometimes it will also pay your regular insurance deductible.

So, you think you have full covered with current policy insurance on your  new car, right?…. maybe not.

When you drive your new car off the lot the value of your vehicle plummets, sometimes as much as 20%-30%.

Say for instance you pay $25,000 for your new vehicle and have an accident a month later. You probably have

only made at the most one payment and if you did not put any money down your loan amount is still close to

the $25,000 purchase price. Unfortunately, even with full coverage, which includes comprehensive and

collision, you will only receive the market value of your vehicle which could be as much as 20%-30% lower than

the purchase price. That means you may be stuck paying that 20%-30%. On a $25,000 car, just a 20%

depreciation would be $5,000! That amount could be more if you financed your taxes and license into your

loan.

Fortunately, you may already have Gap insurance with your current insurer, which would insure you for the

difference between your loan amount on the car and the actual market value of the car. But, not all insurance

companies offer Gap insurance.

Remember these possible exclusions/policy rules:

* Maximum Limit of Loss: $50,000

* A GAP claim settlement may not cover the entire gap due, when your loan’s Original Amount Financed

exceeds 120% of MSRP (new vehicle) or NADA Retail Value (used vehicles), plus 30% of Value allowable for

Additional Financed Items like Credit Life or Service Contracts.

* The claim settlement does not cover late charges or other penalties due to your lender.

* Your loan amount financed must be less than or equal to $100,000.

* Your loan term must not be greater than 84 months.

* The loan must not have a balloon payment due at the end of the term.

* The maximum APR is 12.5%

Here are Commonly Asked Questions about Gap Insurance.

Coverage Gap Insurance?

Choosing an automobile insurance policy can be difficult at best. Determining the amount of coverage you

need, what you want your deductible to be, and whether or not you need gap insurance coverage are all i

mportant decisions that can greatly affect your future financial situation. If you are considering gap insurance, t

here are a few questions you might want to ask yourself.

First and foremost, are you financing your automobile for A Lower Cost Gap Insurance Option

One of the main reasons consumers opt out of purchasing gap insurance is that it can cost as much as $700 at

a car dealership. Many insurance provider offer excellent gap insurance coverage for less than half that

amount! Additionally,  offer a flexible gap policy that can be purchased not only for new cars, but for used

and even refinanced cars as well. To protect your investment.

longer than 24 months? Long-term automobile loans provide the riskiest situation in terms of negative equity

potential. There are car loans now that stretch up to 72 months or more in order to help perhaps less than

qualified consumers purchase the cars of their choice.

Another question you might want to ask yourself when considering whether or not to purchase gap insurance

is whether you’ll make a down payment of at least 30 percent of the car’s value. The less of a down payment

that you make, the larger the potential gap between the fair market value of the car and what you still owe on

your loan. It is becoming commonplace for car buyers to put down as little as zero percent of the car’s

purchase

price, and this can put consumers in a particularly risky financial situation should an accident or theft occur.

Is It Available in Your State?

You should be aware that gap insurance is not actually available in all states. For example, you cannot have

gap insurance in CT, LA, NH, NM, NY, VA, VT or WA. It is also worth noting that the gap insurance we offer at

Minsurances.com is not valid for loan terms that are greater than 84 months. This should not be an

issue in most cases, since most loans do not go beyond the 60 month range. To prevent your investment from

being a liability, gap insurance is the ideal solution.

Is Gap insurance required?

No. Most lending companies who finance cars do require full coverage insurance but not Gap insurance, so the

owner would have to pay the depreciation difference if they had a total loss of their vehicle and chose not to

add Gap insurance to their policy.

How do I know if my insurance company offers Gap insurance?

Before deciding to purchase a new vehicle, check with your current insurance provider about Gap insurance. It

may already be built into the premium. If it is not, Gap insurance can usually be purchased for a reasonable

additional cost. But, some auto insurers do not offer Gap insurance at all. It this case, try to first find a Gap

insurance policy from another insurer before buying it from the dealer - the dealer’s premium may be more

expensive.

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Auto Insurance Frequently Asked Questions

Here are some common automobile insurance frequently asked questions.Do you have another question that is not answered here? You can post it on the comment or email me directly!

I have an old car that isn’t worth much. Do I still need auto insurance?

Liability insurance is required in the state of California. However, you may decide not to purchase physical damage coverage (comprehensive or collision). Usually the cost of repairing damage to older vehicles is greater than the value of the car itself. As a result, if you purchase physical damage coverage, the insurer will usually “total” the vehicle and issue a check for the vehicle’s market value (less the deductible).

Why do I need Uninsured/Underinsured Motorist (UM) coverage if liability coverage is required in California?

Even though liability coverage is required in California, some people are still driving without coverage. In addition, California only requires minimum liability limits of $15,000 per person, $30,000 per accident. If the other party is determined to be legally liable, these limits may not be adequate to cover your damages. This coverage also is applicable in the event of a hit and run accident.

If I borrow my neighbor’s car and get into an accident, whose insurance applies, my neighbors or mine?

Insurance always follows the vehicle first. Therefore, your neighbor’s insurance would be the primary coverage. The driver’s insurance would be secondary.

Will my policy be canceled if I have an accident?

Usually not. The type of accident (fender bender vs. drunkdriving accident), number of accidents (first or third?), and state laws also affect the determination.

What is the difference between comprehensive and collision?

Comprehensive physical damage coverage pays for damage to your car from theft, vandalism, flood, fire, or other covered perils. Collision coverage pays for damage to your car when it hits or is hit by another object.

My car was totaled and my policy did not pay what I think my car was worth. Why?

Most auto insurance policies pay the actual cash value (ACV) of a vehicle totaled in an accident. The ACV is equal to the market value of an auto immediately before the accident.

Insurers must use a fair and reasonable method to determine the value of your car. If you have concerns about their decision you may be able to negotiate with your insurer by telling them why your car may have had more value that what the insurance company originally determined.

My teenager just got his license, but I do not allow him to drive my car. Does he need to be insured?

In most cases, yes. Automobile insurance policies require every licensed person in your household to be listed on your insurance policy unless they have a completely separate policy of their own. This includes a teenager who just received their licence or a college student who still uses your address as their residence and/or visits regularly on weekends, vacations, ect.

How does my driving record affect my insurance premium?

The premium you pay is a direct reflection of your driving record for the past three to five years depending on the insurance company. Insurance companies order driving records from the DMV of your residence state and from other states where you’ve been licensed. Statistics show that drivers with tickets and accidents are more likely to have accidents than drivers with clean records.

What do insurance companies consider when they decide whether to cancel or not renew policies?

Insurance companies evaluate the risks associated with each policyholder to determine if you are a “good risk” or if your policy should be canceled or not renewed. Insurance companies, among other factors, will primarily review your claims, driving, and credit history. It is most favorable that your policy will not be canceled if you don’t have a history of filing frequent claims, have maintained a clean driving record and your credit history is good with no bankruptcy’s.

What coverage does my automobile insurance policy provide me when I rent a car?

The answer to this question is not as easy as it once was. In the not-too-distant past, most automobile insurance policies would extend coverage to rental cars whenever you rented one. This is not quite true anymore.

In most cases, your personal automobile insurance policy will provide coverage only when you are renting a car on vacation. Many insurance companies no longer extend personal automobile insurance coverage when you are traveling on business. The best way to find out what rental car coverage you have under your automobile policy is to call your insurance agent/company.

What is no-fault insurance?

With no-fault insurance, the victims of an automobile accident are compensated by their own insurance company, regardless of who caused the accident. This outcome is different from what occurs under the traditional tort system of compensating victims of an accident.

In the tort system, the party who is at fault is required to compensate the victims of the accident. The idea behind no-fault insurance is to keep small claims from being settled in our expensive legal system. To accomplish its purpose, no-fault insurance restricts the injured person’s right to sue the negligent driver in those instances where the loss falls below a certain threshold.

Two types of thresholds are typically used: verbal thresholds and dollar thresholds. A dollar threshold prescribes a dollar limit that a claim must reach before the injured party regains his or her tort rights, and therefore the ability to sue.

A verbal threshold uses a written description to determine when the injured person regains his or her tort rights. For example, a person might regain his or her tort rights when the accident caused a serious handicap, such as permanent loss of a bodily function.

What do I gain and what do I lose by giving up my tort rights?

Proponents of no-fault insurance argue policyowners gain a number of things by giving up their right to sue in minor accidents. For example, under no-fault insurance you typically pay lower automobile insurance premiums, collect claims payments faster, and spend less time in court. The biggest thing you lose by giving up your right to sue is the ability to collect payments for pain and suffering. No-fault insurance only pays your direct economic losses, such as hospital bills, lost wages, etc. It does not compensate you for any pain and suffering damages that you may incur as a result of an accident.

However, in most serious accidents, where the likelihood of incurring these non-economic losses is greatest, you regain your tort rights and therefore the ability to sue the negligent party for pain and suffering.

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Factors That Affect Car Insurance Premiums

Auto Insurance companies are always looking for reasons to increase what you pay for auto insurance. If you

have an accident. If you have a teen driver. If you file certain types of claim. If you don’t have a garage. If you

buy a car that happens statistically to be stolen more often. If you change jobs and have a longer commute to

work. These are all fators that an insurance company may decide gives them the right to raise your auto

insurance premium.Other factors include what type of job you work, your credit history, your marital status and

the number of miles you drive every day and throughout the year. The only way for you to stop them from

increasing your rates is to make them compete for

your business. As in all negotiations, Information is Power and more importantly, you have to be willing to

Walk Away from a bad relationship.

The Internet provides consumers the opportunity to learn about their insurance

options. First of all, you can get multiple insurance quotes without having to talk to an insurance agent or

sales representative. There are many sites now that allow you to provide driver, vehicle, claims and violations

information online in order to show you insurance quotes from multiple companies. You can also visit each

company site individually and request a single quote from each. You should be wary of individual companies

that promise to give you other company’s rates, in insurance, there are people they want to sell policies to

and people they don’t want to sell policies to, can you really trust them to provide quote information that isn’t

in their company’s best interest. Secondly, just because you shop online with out talking to an agent doesn’t

mean you have to buy online without talking to an agent. Most online services give you the option of talking to

a licensed agent before you buy.

If you aren’t willing to end a bad relationship, then the abuse will never end. We need to

show insurance companies that they can’t just raise rates when ever they feel like it. Insurance companies

know that a rate increase will only motivate a small number of their policyholders to look else where. They

count on your apathy. Don’t let them get away with it. Shop your auto insurance today.

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Parent and teen driving

Five Things Your Teen Must Know Before Driving

class, it is up to parents to steer them toward safe, practical, real-world driving habits. That’s because a driving instructor may teach his/her students how to operate a car, but it is parents who really teach them how to drive.

The reason is simple: Good drivers

aren’t born, they’re made. They are shaped and molded by experience-and teens will get far more experience sitting beside their parents than they ever could during an after-school driver’s ed course where they share the vehicle with two or three other wanna-be drivers.

Each year, an estimated 12,000 traffic accidents involve speeding. And according to a survey by Seventeen magazine and AAA, 40 percent of teens say they have exceeded the speed limit

by 10 mph or more.

So it’s important for parents to teach their teens that getting their license doesn’t mean they’re trying out for NASCAR. Here are some guidelines to help parents through those inevitable discussions about what new drivers can and cannot do:

Why Can’t I Drive At 2 a.m.?

When teens earn their license, parents have a great opportunity to start discussions around safe- driving skills. Teens need to understand curfews, location restrictions and speed limits. This means more than just setting rules; engage your teen in a dialogue about the importance of limitations.

In addition, many companies offer safe-driving contracts to help parents keep teens accountable for their own actions. For example, Safeco Insurance recently launched Teensurance™, a program that uses technology to help families protect their teen drivers as they gain experience and build trust. It includes a set of online tools based on an onboard GPS and notification system, and provides real-world services to give parents peace of mind and help keep teens safe on the road. Parents can set speed, distance and curfew limitations, and the program affords them access to their teens’ vehicles with real-time notification so they will know if their teen drivers are in danger.

But Mom, I Had A Designated Driver

First of all, teens should not drink, nor should their teenage friends. Yet according to the Substance Abuse & Mental Health Services Administration, approximately 50 percent of teens have had at least one drink by age 15. To avoid the chance of your teen riding in a car with a friend who falsely claims to be sober, parents should communicate that it is acceptable for their phone to ring at 2 a.m. for a ride home. Losing sleep is better than losing a child.

You Don’t Own The Road;

You Do Own The Car

Teens may learn defensive driving in classes, but the only way they will see this in action is to learn from parents. Set up an obstacle course in the driveway for your teen. If you don’t have a suitable driveway, find an empty parking lot. Don’t be afraid to tell stories of your previous accidents. Teens can learn how to avoid accidents from your experiences.

Most importantly, children start watching parents’ driving habits long before they get their learner’s permits. Being a good driver is the best way to teach safe driving.

I Have To Change My Oil?

Being a good driver also means taking care of your vehicle-especially since no one else is going to do it. This doesn’t mean drivers also have to be mechanics; they do, however, need to know what maintenance needs to be done-oil changes, tire rotation, windshield fluid, clutch and brake maintenance, etc. It doesn’t matter who does the work, as long as it gets done. And if your teen is interested in learning how to do the mechanical stuff, all the better.

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Free Auto Insurance Quote online.

Why This Lawyer Says You Should Buy Car Insurance From An Independent Broker

I don’t sell car insurance, but as a lawyer practicing in the field of personal injury I frequently see people suffer because they have the wrong insurance coverage. Often, this happens because they purchased directly from an insurance company instead of an independent broker.

Many of my clients who have been seriously hurt in a car accident were struck by someone who had no insurance or only the minimum liability insurance coverage, which is $25,000 in New York and much less in many other states. Unfortunately, many of my clients were sold insurance policies with liability limits of $100,000 or $300,000, but were not sold matching uninsured and underinsured coverage.

Just this week, yet another new client had this problem. My client was a pedestrian crossing the street when she was struck by a car which fled the scene. The driver was caught shortly after leaving the accident, but the owner of the car only has the New York State minimum liability insurance of $25,000 and my client has serious injuries consisting of many broken bones including a fractured arm, leg and skull.

My client owns a car with liability insurance limits of $300,000, but she purchased the insurance from GEICO whose salesperson didn’t sell her underinsured coverage. GEICO does not use independent insurance brokers, but sells insurance directly to consumers through in-house sales agents.

For a small fee, my client could have purchased underinsured coverage of $300,000 which would have allowed her to recover $300,000 for her injuries instead of $25,000. Ironically, she did not need the $300,000 liability coverage to protect her assets. However, since you cannot buy underinsured coverage higher than your liability coverage, I would have advised her to purchase $300,000 liability coverage for the sole purpose of being able to purchase $300,000 underinsured coverage.

I have had many clients in this situation who lost their jobs because of serious injuries and incurred substantial debt. If they had matching underinsured coverage, the additional money available to pay their claim would would be a big help to pay their bills and get their life back together.

Underinsured motorist coverage will pay you money from your own automobile insurance policy if you have been hurt in a car accident by someone who was negligent for causing your injury and who had less liability insurance coverage than you did. Uninsured motorist coverage will pay you when the other car did not have any insurance coverage or the identity of the other car is unknown.

Underinsured and uninsured coverage is inexpensive and usually available in limits that match your liability insurance coverage. It is not available in amounts greater than your liability insurance coverage.

Underinsured and uninsured coverage is so important that a couple of states now require coverage limits matching your liability insurance limits, unless you decline the coverage in writing. Several years ago, I suggested to several New York State senators that they enact a similar law in New York.

I have also seen many clients who were not sold the maximum medical payments insurance, which costs me only $2.01 per month on my car insurance policy. This is particularly important for people who do not have a good health insurance policy. It is also beneficial for passengers who do not have health insurance.

Why should you buy car insurance through an independent insurance broker? The courts have defined the reason. There have been several “malpractice” lawsuits against insurance companies for failure to offer underinsured and uninsured motorists coverage limits matching the liability limits. However, when the insurance company sells directly to consumers, these cases have gone in favor of the insurance companies. The courts found that when a consumer buys insurance directly from an insurance company, rather than an insurance broker, the consumer is only buying insurance and is not paying for advice.

When you buy auto insurance from an independent insurance broker who represents several different insurance companies, you get the advantage of an insurance professional who can evaluate your needs and advise you accordingly. Additionally, only an independent insurance broker can provide you with a choice of insurance companies and premiums, so you get the best coverage at the lowest price.

Whether you buy your car insurance directly from an insurance company or through an independent insurance broker, always make sure that you purchase matching uninsured and underinsured motorist coverage and the maximum medical payment benefits.

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By: Philip L

. Franckel, Esq.

Article Directory: http://www.articledashboard.com

Philip L. Franckel, Esq., is the founder of www.HURT911.org an accident and injury research web site for people hurt in an accident and personal injury lawyers.

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