Does Navy Federal Offer Gap Insurance?
As a car owner, you know how important it is to have the right insurance coverage to protect your investment. One type of insurance that is often overlooked is gap insurance. But what is gap insurance, and does Navy Federal offer it? In this article, we’ll dive into the details of gap insurance and explore whether Navy Federal provides this coverage.
What is Gap Insurance?
Gap insurance, also known as loan/lease gap insurance, is a type of insurance that covers the difference between the actual cash value (ACV) of your vehicle and the outstanding balance of your loan or lease. This coverage is designed to protect you from being upside down on your loan or lease, which can happen when your vehicle depreciates rapidly in the first few years of ownership.
Here’s an example of how gap insurance works:
- You purchase a new car for $30,000 with a 20% down payment and a 5-year loan for $24,000.
- After one year, your car’s ACV is $20,000 due to depreciation.
- If you were to total your car, your insurance company would pay out the ACV of $20,000, leaving you with a $4,000 gap between the ACV and the outstanding loan balance of $24,000.
- With gap insurance, your insurance company would pay the remaining $4,000, covering the gap between the ACV and the loan balance.
Does Navy Federal Offer Gap Insurance?
The short answer is yes, Navy Federal does offer gap insurance. Navy Federal’s Gap Insurance Coverage is available to members who have a loan or lease on their vehicle. This coverage is designed to protect you from being upside down on your loan or lease, and it can be added to your auto insurance policy.
Here are some key features of Navy Federal’s Gap Insurance Coverage:
- Coverage for up to 100% of the vehicle’s value: Navy Federal’s Gap Insurance Coverage will pay up to 100% of the vehicle’s value, minus the deductible, to cover the gap between the ACV and the loan balance.
- Optional deductible: You can choose to pay a deductible of $0, $250, or $500 to reduce your premium.
- Term length: Coverage is available for up to 60 months, or the term length of your loan or lease, whichever is shorter.
- No mileage limitations: Navy Federal’s Gap Insurance Coverage does not have mileage limitations, so you can drive your vehicle as much as you want without worrying about coverage.
How to Add Gap Insurance to Your Navy Federal Auto Insurance Policy
Adding gap insurance to your Navy Federal auto insurance policy is easy. Here are the steps:
- Check your policy: Review your auto insurance policy to see if gap insurance is already included.
- Contact Navy Federal: Reach out to Navy Federal’s customer service department to ask about adding gap insurance to your policy.
- Fill out an application: Complete an application for gap insurance, which will ask for your vehicle’s make, model, and year, as well as your loan or lease balance.
- Pay the premium: Pay the premium for gap insurance, which will vary depending on your vehicle’s value and loan or lease balance.
Benefits of Adding Gap Insurance to Your Navy Federal Auto Insurance Policy
Adding gap insurance to your Navy Federal auto insurance policy can provide peace of mind and financial protection in the event of a total loss. Here are some benefits of adding gap insurance:
- Protection from financial loss: Gap insurance can help you avoid being upside down on your loan or lease, which can be a significant financial burden.
- Simplified claims process: With gap insurance, you won’t have to worry about coming up with the difference between the ACV and the loan balance out of pocket.
- Increased financial security: Adding gap insurance to your auto insurance policy can provide increased financial security and peace of mind.
Conclusion
In conclusion, Navy Federal does offer gap insurance, which can provide valuable protection in the event of a total loss. By adding gap insurance to your auto insurance policy, you can avoid being upside down on your loan or lease and ensure that you’re fully covered in the event of a loss. We hope this article has provided you with a better understanding of gap insurance and how it can benefit you as a Navy Federal member.
