Mandingo

I am buying (not leasing) my LS430 and the dealer offered me Gap insurance today when I picked up the car. I am financing about 3/4 of the purchase price.

I didn't take it, but still have the option to take it later.

Anyone think this is essential/worthwhile?

SharpLS-96

I would definitely purchase Gap (Guaranteed Auto Protection ) if you financed 3/4's the price of a high-line luxury car. In the unfortunate event/case of a claim you might have to file for something happening to the car resulting in a total loss, your insurance company will only pay for the cars value and not what your outstanding loan is at any given time. Gap Insurance covers the difference, it protects you between what the insurance company will pay you in the event you have a total claim on an accident versus what you actually owe on the balance of your payments and your loan. Most people typically owe more on a car than it is worth for the first 3 or 4 years.

05Flagship

I was hesitant to purchase gap insurance but did it anyway... I probably paid too much for my LS 430, BUT I LOVE IT... so if a knucklehead does get careless, I can ensure its paid off.

JffGRY706

I bought my 05 in March 2013 for $18,000 with 72 000 miles on it. I still owe about $7,750 and it trade in value is over $10,000 and resale over $14,000....not for sale at any reasonable price. with full coverage minus $1000 deductible, what would my insurance pay for a total loss or theft? just wondering

05Flagship

JFFGRY706- I believe they will look at milage and year of vehicle and make their adjustment according to their magical numbers - I believe KBB so if your car is worth 7k right now but owe 7700.00 u may have to come out of pocket for the 700.00

jimbosr1

i believe insurance companies use the black book value when totaling a vehicle and retail when you get a policy.

swfla

iTrader: (1)

I think that's a fair assumption. So the OP really needs to look at book values and talk to his insurance agent for price and deductible amount to make an educated decision of what a total loss will really cost him with and without the GAP. Depreciation is the biggest reason for gap insurance. New cars have much higher depreciation than used cars.

Lavrishevo

iTrader: (1)

Yeah, the whole wholesale blackbook deal is such a scam. I never and would ever agree to blackbook values for anything. Not on trade in or total loss cases. Insurance companies just like dealers have no interest in paying you the true market value after a total loss. This is why you have to fight them and sometimes hire a lawyer. Anyway, gap insurance is always good to have unless you owe significantly less then the car is worth.

jmanthony

I would definitely check with your insurance company before pursuing a secondary policy. In our case, we were already covered. YMMV

swfla

iTrader: (1)

Years ago when I drove a horse drawn cart, Black Book was only used by shady used car lots. Now, even dealers will try to use it's skewed values.

takimanpgt

a) If you financed 3/4 of the car value and your term is greater than 3 years (which most likely is not because most banks do not finance a 10 year old car on a 60 month term), then gap insurance is a good idea.
b) You should be talking to your insurance company about gap insurance, not the car dealer. He's not the best person to by buying this through.
c) Someone said he has a $1,000 deductible in the thread. If you are financially well off to afford a $1,000 deductible when and if you ever place a claim for damages, then you most likely shouldn't worry about gap insurance. If paying THAT $1,000 deductible is going to put a LARGE dent in your finances, then you probably should pay the $20 per year for gap insurance until your lien is paid off.

Insurance, of any kind, is simply a matter of you and your financial risk index. If you have a 6 month emergency rainy day savings fund set aside to cover ALL 100% of your monthly expenses for that time frame, then you may want to risk not having gap insurance but if not, then think seriously about the weight of the $20 per year gap insurance versus losing thousands of dollars in depreciation not covered under the insurance claim.

I'd also plug the same thought process in when someone is buying a brand new car. The minute it drives off the lot, there's a 15-20% hit to depreciation which then could be covered under gap insurance unless you didn't ask your insurance company to add it in.

SW17LS

Just to make sure everybody realizes, this is a really old thread from back when the 430 was new. The OP was buying a new 430.

GAP insurance is more important on a new car vs a used cars. The 430s are so depreciated now it's likely not worthwhile even at 100% financed.

Tom57

This is an example of the Liberty Insurance new car insurance national ad campaign, currently running.

swfla

iTrader: (1)

I didn't notice the date...

SW17LS

I didn't notice it at first either lol