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 Posted: Thu Nov 13, 2008 12:21 am Post subject: Gap Insurance - state farm |
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I'm getting ready to buy my first new car. I've waited a long time for it, but she's finally going to be mine...
Anyway, I have some questions about Gap Insurance because I know that it will be presented to me as an option while I'm in the finance department.
I'll be financing about 72K at 3.9% over 5 years. I'm not planning on putting anything down on the car because I have another loan at a much higher interest rate that I'd prefer to pay down. Therefore, I thought that Gap insurance might be a good idea.
My sister is my auto insurance agent and she was not able to offer gap insurance state farm policy directly. I'm quite confident that the product that my dealership will offer me will come at quite a premium, so I was looking to buy it from a 3rd party. I guess that I have 3 questions:
1. How much should a gap insurance policy cost me?
2. Can you recommend a reputable 3rd party gap insurer?
3. Does anyone know anything about gapinsurancequotes.com? They offer a policy for less than $400 and claim to be A-rated, but I can't find out much about them.
Many Thanks
John |
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Juano11
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| Posted: Thu Nov 13, 2008 3:53 am Post subject: Some Thoughts |
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Congrats on the new car, Juano! I'm sure it will be a great ride for 72K. Enjoy!
I like the idea of Gap Insurance, especially for that amount of money. I used to be a gap insurance state farm Agent. Although I don't have the particulars of that coverage in front of me, we offered it through State Farm Bank. Two yrs ago, you would get approved via SF Bank, start the loan and Gap Insurance was included with the loan at no charge. Again, this was not offered through State Farm Insurance, but State Farm Bank.
Check with your finance company, first, then your bank, or credit union. It's a common request and they should be familiar with the product. I would shy away from other sources until you exhaust traditional outlets for Gap Insurance. |
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CarInsuranceGuy
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| Posted: Thu Nov 13, 2008 6:32 am Post subject: |
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Gap insurance is just the right thing to have at this juncture to ensure the peace of mind. $72k is pretty big an amount to finance a car. Car Guy is right, its surely gonna be a great ride  . its also important that you maintain sufficient collision and comprehensive coverage on it for the period of the loan.
You can also purchase the gap insurance separately from another insurer if its not available with the current insurance company. Some financing companies may have the gap insurance built within the loan amount. Hence, it would be wise to check that possibility.
Hope it helps.
~Jeremy |
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JeremyHolter
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| Posted: Thu Nov 13, 2008 6:42 am Post subject: |
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Gap insurance isn't very expensive but a great coverage especially when you are upside down on a car loan. You can obtain the gap policy at reasonable rate from an insurer. Dealers offer gap insurance as well but often at higher rates.
The gap insurance can be maintained with another insurer, who isn't insuring the car. I hope that your agent will be able to help you in this issue. |
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simon
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| Posted: Thu Nov 13, 2008 11:09 am Post subject: |
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$72,000 financed at 3.9% interest for 5 years results in a monthly payment of $1,323 for 60 months for a total of $79,380 paid out.
Automobiles are interesting.
They are the only goods sold whereby the purchaser knows going into the deal it's a losing proposition yet they do it freely, willingly and with such enthusiasm.
I wonder how many people would go to their financial advisor and buy a product,... stock, bond, mutual fund, annuity, money market, bank CD, etc...and the deal is... invest $79,380 dollars over the next 5 years for an item that will be worth about $40,000 at best in five years?
And then in some bIzArRe twist of financial logic be concerned about GAP insurance so they don't get into DEEP financial doo-doo if the fine ride becomes scrap metal. 
Sorry, no way, no how, would I pay that kind of money for a car.....
....UNLESS the mechanic comes with it!  
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GarySpicuzza
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| Posted: Thu Nov 13, 2008 11:43 am Post subject: |
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Gary, HA!, I know, I know...you're right.  A new car is never a sound investment. It's a toy. An expensive toy, but one that I've wanted for a long time and that I've worked hard to be able to afford.
I could put more down on the car, but we've also got a small home equity loan, at a higher rate, that I'd prefer to put the money toward.
I'm looking for the Gap insurance to keep what I acknowledge is a bad financial decision from suddenly turning into a terrible one.
Car Insurance Guy, gap insurance state farm bank is offered if you finance through them, but their interest rate is a couple of points higher than the loan that I can get through the dealership.
Can anyone point me toward a specific insurer for gap insurance? If there are rules against this on the forum, then I apologize.
I know that I want to purchase gap insurance on this loan. I know that car dealerships typically sell 3rd party products at a markup. I'd like to "skip the middle man" and save myself a few hundred bucks by purchasing it myself, but I'd like to buy it from a reliable insurer, I just don't know who that reliable insurer is.
Many thanks
John |
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Juano11
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| Posted: Thu Nov 13, 2008 12:01 pm Post subject: |
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I know that progressive sells it, but don't know if you have to have their auto policy to get it...ask your lein holder to give you the names of several carriers .... wow 72k for a car...that's more than my first two houses cost combined! What is the car?
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Lori
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| Posted: Thu Nov 13, 2008 12:13 pm Post subject: |
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It's an 09 BMW M3, and believe it or not, I'm actually getting a good price on it...ha! The 72K is after tax, title, etc...
I was hesitant to post the price, but I thought that it might be helpful to know how much I'm financing to determine how much gap insurance would cost.
Thanks for the tip on Progressive, I'll see what I can find.
Does anyone else have any suggestions? |
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Juano11
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| Posted: Thu Nov 13, 2008 12:24 pm Post subject: |
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As I said, I'd ask the finance company for names of carriers offering this coverage, so you can contact them directly, another tip is to check your states Dept of Ins website, they generally list company's that are in good standing in your state, and what coverages/policys they sell...
ps Good for you! wow first car and it's a NEW beamer! livin' large my friend, livin' large!
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Lori
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| Posted: Thu Nov 13, 2008 1:27 pm Post subject: |
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Does the "mechanic" come with it? 
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GarySpicuzza
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| Posted: Fri Nov 14, 2008 1:29 am Post subject: |
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Geeze, I'd need one Gary, to figure out how to start the darn thing 
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Lori
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| Posted: Sun Nov 16, 2008 12:09 pm Post subject: |
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Mechanic for Lori!
Remember our "new" Prez said:
| Quote: | | "There are things you can do individually, though, to save energy. Making sure your tires are properly inflated — simple thing. But we could save all the oil that they're talking about getting off drilling — if everybody was just inflating their tires? And getting regular tune-ups? You'd actually save just as much!" |
I voted for Palin, she's cute, but I'm NOT the least bit disappointed ObamaMan won!
How did this thread turn Poli-Tic-Ill?
Weren't we talkin' 'bout fast cars and pretty girls?
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GarySpicuzza
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| Posted: Sun Nov 16, 2008 12:23 pm Post subject: |
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I'll pass on that mechanic my old husband is WAY cuter...
| Quote: | | How did this thread turn Poli-Tic-Ill? |
You did it...
| Quote: | | Weren't we talkin' 'bout fast cars and pretty girls? |
No you did that too, it was about GAP ins... (p.s. 'I' don't care when we wonder a little if the OP has been answered...just an fyi and for clarity)
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"Never, never be afraid to do what's right, especially if the well being of a person or animal is at stake. Society's punishments are small compared to the wounds we inflict on our soul when we look the other way." Martin Luther King Jr. |
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Lori
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| Posted: Sun Nov 16, 2008 12:46 pm Post subject: |
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Hmmmmmm, GAP insurance?
What's that?
Gary Approved Protection?
 Arrrrrrgh, properly and casually insurance.
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Gary Spicuzza, *SAFE
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GarySpicuzza
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| Posted: Tue Dec 09, 2008 3:50 am Post subject: Gap Insurance Article |
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All this talk about Gap Insurance made me curious. I wrote up a short intro for those who might be interested. The material is probably a little basic for the regulars here, but if anyone's interested feel free to check it out.
www.carinsuranceguidebook.com/gap-insurance/ |
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CarInsuranceGuy
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