What is Gap Insurance?

D&M Leasing pic
D&M Leasing
Image: dmautoleasing.com

D&M Auto Leasing offers car leases to drivers in the Dallas-Fort Worth, Grand Prairie, and Houston areas. D&M Auto Leasing is the nation’s largest car leasing company, offering an extensive selection at competitive rates. Gap insurance is included in all contracts from D&M Leasing.

Question: What is gap insurance?
Answer: Gap insurance protects car lessees and owners when their vehicle is stolen or totaled before it is paid off. Specifically, gap insurance covers the difference between the value of the vehicle, and the amount owed on the vehicle.

Question: Why is gap insurance important?
Answer: When a vehicle is totaled, insurance companies only pay out what the vehicle was worth. If a vehicle worth $12,000 is totaled when the driver owes $13,000 on it, auto insurance will pay out $12,000 and the driver will be left with a debt for a vehicle that no longer exists. Gap insurance covers that remaining $1,000.

Question: Does gap insurance cover interest?
Answer: Gap insurance does not cover owed interest, nor does it cover any penalties or late fees.

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