Car insurance comes in many shapes and forms, one of them is the "loan-lease payoff coverage". Here is an article by Mike Heuer explaining this.
Loan Lease Payoff Coverage Explained
The various terms used to describe different types of auto insurance can be very confusing, and one of the most confusing can be a loan lease payoff policy, which is similar to GAP protection for vehicles but has some differences.
GAP Insurance for vehicles must be purchased when buying the vehicle or purchasing a new policy to insure it. But loan lease payoff protection can be added at any time without impacting the insurance coverage already in place. That means it is easy to shop around and find a good deal on loan lease plans while GAP policies often bought at the time the vehicle is financed and licensed.
Such payoff plans do exactly that - they will pay off the difference between what a vehicle is worth and what an auto insurer will provide if it is totaled or stolen. But there are limits on how much a policy will provide by way of protection. Because financed and leased vehicles must have full coverage plans in place to protect the owners as well as the lenders financing the transaction, loan lease coverage generally pays up to 25 percent of the actual cash value for a vehicle.
Generally, that 25 percent range is plenty to pay the potential difference in a vehicle's actual cash value and what an insurer determines it is worth in the event of a total loss. If a leased or financed vehicle has a cash value of $40,000, the insurance plan would pay up to $10,000 if an insurer deems it to be worth less than what is owed on it minus any applicable deductibles.
Obviously, people who lease vehicles could benefit from such policy protections, especially if they have driven far more miles than are allocated per year on the vehicle. The more miles driven on a leased vehicle, the more is owed on it at the time the lease expires or if totaled due to an accident or theft.
And people who pay less than 20 percent down on a vehicle or who have a high interest rate also could benefit from the coverage provided by such insurance plans. Many times, people who cannot afford to pay at least 20 percent down when buying a vehicle also find themselves paying a higher interest rate on their loans, making coverage more of a necessity.
Such insurance plans generally are very affordable for what they provide and can be purchased through a variety of companies. Because a deductible can be applied, the rates can be made very low. So when looking for quality protection at a low rate, a loan lease policy can help people who might find themselves owing a great deal of money to a lender who has the right to demand immediate payment if a financed auto is totaled and the actual cash value is less than what is owed on the lease or loan.
Find good deals on loan lease payoff insurance and other types of car insurance at http://www.GeneralInsurance.org.
Source: EzineArticles.com.
GAP Insurance for vehicles must be purchased when buying the vehicle or purchasing a new policy to insure it. But loan lease payoff protection can be added at any time without impacting the insurance coverage already in place. That means it is easy to shop around and find a good deal on loan lease plans while GAP policies often bought at the time the vehicle is financed and licensed.
Such payoff plans do exactly that - they will pay off the difference between what a vehicle is worth and what an auto insurer will provide if it is totaled or stolen. But there are limits on how much a policy will provide by way of protection. Because financed and leased vehicles must have full coverage plans in place to protect the owners as well as the lenders financing the transaction, loan lease coverage generally pays up to 25 percent of the actual cash value for a vehicle.
Generally, that 25 percent range is plenty to pay the potential difference in a vehicle's actual cash value and what an insurer determines it is worth in the event of a total loss. If a leased or financed vehicle has a cash value of $40,000, the insurance plan would pay up to $10,000 if an insurer deems it to be worth less than what is owed on it minus any applicable deductibles.
Obviously, people who lease vehicles could benefit from such policy protections, especially if they have driven far more miles than are allocated per year on the vehicle. The more miles driven on a leased vehicle, the more is owed on it at the time the lease expires or if totaled due to an accident or theft.
And people who pay less than 20 percent down on a vehicle or who have a high interest rate also could benefit from the coverage provided by such insurance plans. Many times, people who cannot afford to pay at least 20 percent down when buying a vehicle also find themselves paying a higher interest rate on their loans, making coverage more of a necessity.
Such insurance plans generally are very affordable for what they provide and can be purchased through a variety of companies. Because a deductible can be applied, the rates can be made very low. So when looking for quality protection at a low rate, a loan lease policy can help people who might find themselves owing a great deal of money to a lender who has the right to demand immediate payment if a financed auto is totaled and the actual cash value is less than what is owed on the lease or loan.
Find good deals on loan lease payoff insurance and other types of car insurance at http://www.GeneralInsurance.org.
Source: EzineArticles.com.
Thank you Mike! That was another great article.
Nadav
nadavs
No comments:
Post a Comment