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Best GAP Insurance Companies (2020)

The best GAP insurance companies will cover 25 percent or more of the actual cash value of your car if it's ever totaled to pay off your loan. GAP Insurance reviews can help you to choose a reliable GAP insurance company. Affordable GAP insurance rates are available as an add-on to your insurance coverage, or as a standalone policy.

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Eric Stauffer is a former insurance agent and banker turned consumer advocate. His priority is to help educate individuals and families about the different types of insurance they need, and assist them in finding the best...

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UPDATED: Sep 16, 2020

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The Highlights

  • Guaranteed asset protection (GAP) insurance pays the difference between the value of your car and what you owe on the loan if the vehicle is totaled.
  • GAP insurance can be purchased from the car dealership or through your insurance company.
  • Stand-alone GAP insurance is usually more expensive than adding GAP insurance to your existing policy.

The best GAP insurance companies are usually companies with the highest market share in the insurance industry. While choosing the best insurance isn’t always easy, GAP insurance reviews can get you on the right track.

GAP is an acronym that stands for guaranteed asset protection. Guaranteed asset protection insurance helps cover the difference between what your car is worth and what you still owe on your loan. GAP insurance is available as an add-on to your insurance policy.

In case of an accident, the best GAP insurance companies cover the difference between what your car is worth and what you still owe on your loan. Often, the best stand-alone GAP insurance companies cannot compete with standard car insurance providers and loan lenders when it comes to affordability.

Not all of the best insurance companies offer gap insurance, however.

Whether you’re buying a new or used car, read our guide to learn why you should add GAP insurance to your policy. It could help you save thousands. Continue reading to learn where you can buy GAP insurance.

To find out who offers the best GAP insurance rates for your financed vehicle, enter your ZIP code into our FREE tool above to start comparison shopping.

Is it a good idea to get GAP insurance?

You’ve come to the right place for expert GAP insurance advice. According to the Insurance Information Institute, GAP insurance is a good idea if you’ll ever owe more on your vehicle than it’s worth.

For example, say you buy a brand new car for $30,000 and put down $1,000. Now imagine that car is totaled a month after you buy it. Your insurance company will only pay the actual cash value of your vehicle, which is different from what you financed for your new car.

Take a look at the table below to see approximately how your insurance company calculates the actual cash value of your vehicle.

Auto Insurance Company Calculation for Actual Cash Value of a New Car
New Car Deprecation ScenerioCash Value of Car
Brand new car cost$30,000
Car deprecation rate11%
Actual cash value of car$26,700
Get Your Rates Quote Now

New cars depreciate by about 11 percent right after purchase. Your $30,000 car is now only worth $26,300, and you’ve only made one payment.

Since your car insurance company only pays the actual cash value for your totaled vehicle, you’ll still owe $2,700 on your loan for a car that is no longer driveable. GAP insurance is there to pay that amount, so you don’t have to pay out of pocket.

If you own your car outright, or if you owe less on your loan than the actual cash value of the vehicle, you do not need GAP insurance.

Fortunately, if you do require it, there are many expert auto GAP protection options available for you. You may be asking, does Progressive sell GAP insurance? What about other companies? Does State Farm have GAP insurance?

It’s possible to secure very cheap rates for GAP coverage, but you have to know where to look. Keep reading to learn the best place to get GAP insurance.

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What is GAP insurance?

Before we tackle specific questions, like does Progressive have GAP insurance, you might be wondering, what is GAP coverage? And when should you purchase GAP coverage?

Guaranteed asset protection insurance, otherwise known as GAP insurance, is an additional policy that pays the difference between the actual cash value of your car and what you still owe on loan in the case of a total loss.

GAP insurance is a good idea if you owe more on a car loan than the car is actually worth.

Since insurance companies only pay the actual cash value for your totaled vehicle when paying out a claim, you may find yourself owing thousands of dollars to your lender. GAP insurance prevents that from happening.

Sometimes when you purchase a new car, a GAP insurance quote is offered by the dealership. If you choose this route, otherwise known as a stand-alone policy, know that you’ll pay interest on the coverage.

But does State Farm or Progressive offer GAP insurance? Or any other major commercial companies? Fortunately, you can also purchase this coverage from a car insurance company. Insurance companies that offer GAP coverage include most major companies, as well as some local agencies. Keep reading to see who we recommend.

Can I buy stand-alone GAP insurance?

First of all, what is stand-alone GAP insurance? If you purchase only GAP insurance from a company and nothing else, that’s considered a stand-alone policy.

If you’re wondering who sells stand-alone GAP insurance, it depends on where you live. A quick internet search will help you locate local agencies that offer this service. How do you know if they’re any good? It’s easy; gap insurance reviews will help you decide.

For example, larger national companies, like GapDirect, do provide stand-alone GAP insurance. But, the GapDirect reviews are low. Perform a GAP insurance price comparison and look at consumer reviews before choosing.

If it’s not easy to access a company’s GAP insurance number, that company probably isn’t the best resource for automotive GAP insurance.

While stand-alone GAP insurance coverage exists, it’s usually not the most affordable option. We were unable to find a single company that had a reputation solid enough to meet our standards.

Remember, you’re looking for the best car GAP insurance, which may or may not be a GAP insurance stand-alone policy. A new car GAP insurance quote from the dealer will never be the best option. Stand-alone GAP insurance providers offer you similar bad deals.

Kevin Hunter explores the issue further in the following video.

Commonly, the fee you pay for stand-alone GAP insurance is more than what your car insurance company would charge you if you added GAP insurance to your policy.

Similarly, your loan provider will also usually charge a lower rate than what you’ll receive from a stand-alone company. For this reason, we highly recommend you compare GAP insurance quotes. A car GAP insurance comparison will save you money and prevent future stress.

As a result, our recommendations for the best GAP insurance coverage are focused on top companies that will require you to use them as your insurance provider or as your lender.

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What companies sell GAP insurance?

You may be wondering what auto insurance companies offer GAP insurance. You may be asking yourself, does State Farm provide GAP insurance? Or does Progressive Insurance have GAP coverage? What are the best-rated GAP insurance companies?

To answer what insurance companies offer GAP coverage, almost all major commercial companies provide this service. Your loan provider and car dealership also offer this coverage.

Before purchasing Progressive Insurance GAP coverage or State Farm Insurance GAP insurance, we recommend checking with your provider and lender to make sure it’s not already part of your policy.

Many auto insurance companies offer GAP insurance, but it’s only available if you purchase an insurance policy with that company. Some companies offer it only if you finance through them.

Check out our top three recommendations for the best companies that offer GAP insurance, and read reviews of GAP insurance companies below.

Progressive GAP Insurance

Progressive’s insurance reputation is stellar; not only are they affordable, but they provide coverage across the country. So can you get GAP insurance through Progressive? Fortunately, the answer is yes.

Otherwise known as Progressive loan lease payoff insurance, Progressive Insurance has affordable GAP insurance. Another benefit to the loan lease payoff coverage from Progressive? Progressive’s GAP insurance is also relatively good. Read our Progressive insurance review to learn more.

If you’re ever unhappy with the Progressive new car replacement program, there’s a place to submit Progressive Insurance total loss complaints on the company’s website.

How much is GAP insurance through Progressive? Let’s look at the Progressive GAP insurance rates. Believe it or not, Progressive offers GAP insurance for just five additional dollars per month. Are you wondering how to add GAP insurance with Progressive? Choose to add the Progressive loan/lease payoff coverage to your policy, or work directly with one of the company’s agents.

The loan/lease payoff coverage through Progressive pays up to 25 percent above the actual cash value of your vehicle in the event of a total loss. But how does Progressive determine actual cash value? They calculate your vehicle’s depreciation, similar to the scenario above.

While it’s not a guaranteed payoff of your loan amount, it is a reliable protection for a great price. This option makes buying a new car after total loss with Progressive Insurance much less of a financial burden.

Does Progressive provide GAP insurance and auto loans? While you’ll find Progressive money loan reviews online, they are for personal loans only.

Progressive Insurance car loans exist, but the only way to access Progressive auto GAP insurance is by buying an insurance policy from the company directly.

If affordability is your goal, GAP insurance from Progressive is perfect for you. However, if you want more comprehensive replacement coverage or want your GAP insurance included in your loan, you’ll have to look elsewhere.

AAA GAP Auto Insurance

Does AAA offer GAP insurance? Yes, they do, but unlike Progressive, you can choose to buy GAP insurance through AAA’s auto financing department, or as an insurance policyholder, but this varies by state. AAA auto insurance is affordable, as well.

You can also choose a new car added protection endorsement; AAA offers this add on to comprehensive coverage to its policyholders.

If you choose to finance your vehicle through AAA, you can be covered by GAP insurance without having to switch insurance companies. Fortunately, AAA auto loan reviews are excellent.

The AAA GAP insurance quote is an average flat rate of $395, as listed on the AAA website. While the price is not as low as Progressive’s GAP insurance rates, the coverage is still substantial, and you don’t have to use AAA as your insurance provider.

However, to purchase AAA GAP insurance, a membership is required, and that comes with an additional fee.

While the AAA membership comes with a lot of benefits and the AAA car loan reviews are mostly positive, this option is not the most budget-friendly.

That being said, AAA auto protection reviews are good, with high customer satisfaction rates. Paying more upfront for a better customer experience might be worth your while if it fits your budget.

State Farm Auto Insurance GAP Coverage

The biggest auto insurance company in America is State Farm. Does State Farm offer GAP insurance? Yes, it does. State Farm’s GAP insurance is also known as payoff protector car insurance. You can purchase the State Farm payoff protector in two ways.

Does State Farm offer auto loans like AAA? The good news is, it does have an auto lending service. However, unlike AAA, the payoff protector is included in your State Farm Bank auto loan rates.

If you choose State Farm lending for car loan purposes, you’ll be a happy customer. You can easily access your State Farm auto loan payoff amount at any time through your account or by calling the State Farm payoff number.

The State Farm auto payoff number can be found on the company’s website.

The State Farm bank dealer services are straightforward to navigate on the website. There you can find not only the State Farm bank payoff number but also the State Farm bank payoff address.

State Farm auto insurance reviews are comparable to AAA. How much is GAP insurance from State Farm? Because State Farm GAP insurance is included for loan customers even if they don’t insure with State Farm, it’s difficult to answer that question.

Okay, but can I buy GAP insurance from State Farm as an auto insurance customer? Yes, State Farm does provide GAP insurance as an additional coverage option. Just ask for a State Farm payoff quote.

Like other companies, the State Farm insurance totaled vehicle process only pays the actual cash value of your car. Opting to add State Farm’s GAP insurance will help cover what you still owe on your loan.

State Farm might not be the least expensive option, but the company has a great reputation. This may be why more people insure with them than any other company in the country.

Easy access to things like the State Farm car loan payoff number for consumers indicates that this is a reliable company.

Unlike AAA, you do not need to pay a membership fee to use State Farm’s services, making this company a competitive option for affordable GAP insurance.

There are other auto GAP insurance providers besides State Farm, AAA, and Progressive. Ultimately, the best car insurance with GAP coverage could be different for everyone.

Shopping for GAP Insurance

While Progressive, AAA, and State Farm are our three top GAP insurance companies, you might secure cheaper rates with another company. Therefore, we recommend comparison shopping to see which GAP insurance company offers GAP coverage that best fits your individual needs.

According to the Experian, some auto insurance companies will issue rates based on your credit score.

Pay attention to the GAP car insurance reviews from other customers to ensure the company you choose will be compatible with you. While there are plenty of insurance companies offering GAP insurance, the cheapest GAP auto insurance quotes aren’t always the best options.

Remember, good GAP insurance companies should not cost you an arm and a leg. A car dealership may try to convince you to roll GAP insurance into your loan, but this will be expensive, and most financial experts recommend against it.

Not only will you pay a high flat-rate amount for the coverage, but you’ll also pay interest if you roll it into the loan.

The absolute best way to buy GAP insurance is to shop around. Several companies offer this coverage either as an add-on or as part of specific policies. Your odds of finding a great deal on your car insurance overall are pretty good.

If changing car insurance companies is not something that interests you, the next thing to consider is refinancing your loan. You can add GAP insurance later if you need to, but it’s best to buy it at the time that you take out the loan.

A lot of lenders offer this coverage besides AAA and State Farm, including many credit unions. Just make sure you’re not taking a higher interest rate in return for coverage, as that will cost you more in the long run. GAP insurance is not something you need forever. Once you no longer owe more for your loan than your vehicle is worth, you no longer require the coverage.

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Frequently Asked Questions: Best GAP Insurance Companies

Now you know the best stand-alone GAP insurance rates will always be higher than purchasing coverage through your insurance company or loan provider. You’re ready to secure the best GAP coverage for your needs.

Did you think of something we missed? Check out our frequently asked questions below.

#1 – Does AAA offer GAP insurance in California?

Yes, AAA does offer GAP insurance in California.

#2 – AAA vs. State Farm, who is better for GAP insurance?

The only way to know which company is best for you is by comparing GAP insurance quotes.

#3 – Who are the best stand-alone GAP insurance providers?

You can do a quick internet search for local businesses that sell stand-alone GAP insurance for a one-time fee. However, buying it through your insurance provider is a better, more affordable option.

#4 – Does Allstate offer GAP insurance?

Yes, you can purchase Allstate GAP insurance.

#5 – Can I buy GAP insurance by itself?

Yes, you can purchase stand-alone gap insurance; this is also known as third-party GAP insurance. GAP insurance rates are often higher than average when purchased this way.

#6 – What are the Direct Gap insurance reviews?

Most Direct Gap claim reviews are decent, but this company is based in Europe, not in America.

#7 – What are the Total Loss Gap customer reviews?

Total Loss Gap insurance reviews are average, but Total Loss Gap reviews are only applicable for Europeans.

#8 – Where can I buy stand-alone Gap insurance?

You can buy this type of insurance from providers in your area, do a quick internet search to see where to buy Gap insurance near you. EasyCare GAP insurance is one such provider.

#9 – Who offers the best GAP insurance?

State Farm, Progressive, and Geico GAP insurance are among the top five GAP insurance companies. Contact your insurance company, and they can refer you to the GAP insurance number.

#10 – Is GAP insurance worth the money?

It depends on what you want to cover. GAP insurance is ideal for commercial insurance options and personal vehicles that are insanely expensive. For more economical cars, you can save money by enrolling full coverage insurance.

Are you looking to buy GAP insurance? Compare cheap GAP car insurance quotes from auto insurance companies with affordable GAP insurance policies by entering your ZIP code into our FREE tool below.

References:

  1. https://www.iii.org/article/what-gap-insurance
  2. https://www.experian.com/blogs/ask-experian/how-to-lower-your-auto-insurance-costs-now/

About Eric Stauffer

Author: Eric StaufferI am a former insurance agent and banker turned consumer advocate. My priority is to help educate individuals and families about the different types of insurance they need, and assist them in finding the best place to get it.

4 Comments

  1. I am looking for a stand alone gap insurance for my new 2020 Toyota but GapDirect will not insure me.

    I have a 84 month loan and they only go up to a 72 month loan.

    Is there another company??

    Reply
  2. I, too, would like to see a list of reputable companies that provide stand alone GAP insurance.

    Geico is listed, but I was told they don’t offer GAP at this time, so I’m looking for a stand-alone policy.

    Thanks!

    Reply
  3. I declined the GAP insurance from the dealership when I leased my new vehicle, too expensive.

    My full coverage auto insurance is with State Farm, who doesn’t offer a GAP endorsement to their policyholders unless you finance through State Farm Bank and I leased not purchased.

    You mentioned buying gap insurance from a “dedicated GAP insurance company”, so who are these GAP insurance companies and which one is the best to buy from.

    Thank you!

    Reply
    • GapDirect.com

      Reply

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