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Auto loan/lease coverage.
Shopping for a new car… What can be more exiting? You have, probably, read tons of information regarding that specific model you are interested in. You know all the tiny details and the best features. Mmm, that smell of new leather seats is so amazing, fingers are wrapped around the wheel, feel the power...
New cars are great in so many ways; the only downfall is the depreciation. In a matter of a year the cost of the vehicle may drop up to 20%. The problem arises when you have to pay off the lease or loan even if the vehicle is totaled.
Some insurance companies help with this situation by offering its customers a special endorsement, called Auto Loan/Lease coverage. As you understand it is an optional coverage, which is available for new cars only with a loan held by a financial institution. So, in case of an accident auto loan coverage will pay the difference between your loan and the actual cash value (you can find at Edmunds.com).
Costs will vary from company to company; Travelers, for example, calculate theirs by taking 5% of Comprehensive and 5% of Collision premium.
Give your agent a call to see if you qualify for auto loan/lease coverage. It’s a nice, valuable, extra protection for your car and a peace of mind.
