Purchasing a new vehicle is often a huge milestone in a person’s life, and along with this privilege comes a lot of responsibility. Not only do you have to make sure that you pay your lender on time each month, but you also have to obtain auto insurance. Some drivers also find that they prefer to purchase gap coverage for their vehicle.

Rather than spending time searching for quotes from multiple insurers, New York residents can visit Insurify. After you answer a few questions about your vehicle and your driving habits, you’ll be able to select from a list of free car insurance quotes that fit your budget. Let’s take a look at what gap coverage entails for drivers in New York so you know exactly what options are right for you.

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What is gap insurance

Many drivers purchase a new car with an auto loan, and for the first several years, they often end up owing more on the car than their payoff amount due to depreciation. If you get into an accident with enough physical damage that results in a total loss of your car, you’ll be responsible for paying the difference between your loan balance and the car’s value.

This scenario is where gap insurance coverage, also called a gap waiver when sold by an auto dealership, comes into play. Instead of having to continue monthly payments on a vehicle you don’t even have, you’ll get funds from your gap insurance to help you pay off your loan. It’s an ideal option for drivers who are leasing their vehicles or who want the ultimate peace of mind.

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New York Gap Insurance Laws

Guaranteed auto protection, or gap coverage, is not legally required in New York state; however, if you purchase a new car from an auto dealership, they must offer you the option to enroll in this type of protection. Gap coverage can also be obtained as an option on your insurance policy if you do not want to enroll at the time of your auto purchase.

Individuals who are leasing a vehicle, rather than financing it, will want to clarify their gap insurance options before signing their retail lease agreement. When you lease a vehicle, your monthly payments allow for your continued use of the vehicle rather than helping you to eventually own the car, therefore gap coverage stipulations may be slightly different. 

How Gap Insurance Works in New York

Gap coverage can be purchased from an auto dealership or through an insurance agent in New York, but it’s important that drivers have a full understanding of how this protection actually works before they sign on the dotted line. Rather than acting as a stand-alone type of insurance policy, gap coverage is an additional component of your auto insurance

Gap protection is designed to help cover you financially in the event of a total loss of your vehicle. Most drivers opt for a car loan when it comes time to get a new car, and due to depreciation, their loan payoff amount is typically much higher than the car’s actual cash value for at least the first several years of ownership.

Should you total your vehicle, your auto insurance will pay out based on the car’s ACV, leaving a gap between this dollar amount and what you owe on your car loan. Gap protection offers additional funds to bridge this gap. It’s a smart idea to enroll in this coverage if you put a small down payment on your vehicle or if your loan extends beyond 48 months.

How Much Gap Insurance Costs in New York

Purchasing gap coverage for your motor vehicle isn’t quite as involved as enrolling in auto insurance, as the options and price points are pretty standardized. Drivers in New York can expect to pay several hundred dollars annually for coverage in most cases, although this will vary if you purchase protection from a finance company compared to an insurance agent.

Unlike auto insurance coverage, which offers a range of deductibles and policy limits, gap coverage is a more fixed type of protection. Drivers don’t purchase a certain dollar amount of coverage; rather, the policy is designed to pay out the gap amount in the event of a total loss or theft of your vehicle.

However, you can still save a couple hundred dollars with Insurify’s auto insurance quotes comparison tool today! 

How to Buy Gap Insurance in New York 

Purchasing gap insurance as a New York resident is very straightforward. Drivers can enroll in this protection directly through the auto dealership at the time of their new car purchase or lease. Others who are taking on a car loan but prefer to acquire gap coverage through an insurance company can add it to their existing policy.

New York drivers looking for the best deal on gap coverage should visit Insurify before finalizing any purchase. You’ll be able to view real-time quotes on car insurance that include gap coverage, view any discounts available, and enroll in a policy with just a few clicks. Insurify helps New Yorkers save time and money on their auto insurance with ease.

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Best Companies for Gap Insurance in New York 

Auto insurance in New York can be quite affordable if you know where to look. Drivers looking to save on their policy as well as purchase gap insurance coverage may want to explore some of the following insurers and can expect payments to average around these price points:

New York Car Insurance Company Monthly Gap Insurance Payment
TSC $170.00
Travelers $208.00
Plymouth Rock $261.00
Midvale $295.00
Progressive Insurance $309.00

Check out our piece on the best gap insurance companies for more information!

Frequently Asked Questions: Gap Insurance in New York

Does New York law require gap insurance?

New York law does not require motorists who purchase a new car via an auto loan to enroll in gap insurance coverage, but individuals who are leasing a vehicle will be required to do so. If you are financing your vehicle, gap insurance can be purchased through an auto dealership or an insurance company.

Do you get money back from gap insurance once you’ve paid off your car?

Some drivers may be eligible for a refund of their gap insurance premium if they pay off their car loan early, but it’s best to contact your coverage provider for more details. If the cost of your gap coverage is included in your monthly car payment, you may not be entitled to a refund.

Where can I find cheap gap insurance in New York?

New York drivers don’t have to spend time comparing quotes for gap insurance from multiple companies just to find the best deal. Insurify helps you save money by gathering prices from a variety of insurers and can help you find cheap gap coverage that fits your budget.

Updated June 11, 2021

Courtney Elder has loved to write since age six, yet she didn’t turn it into a career until many years after that. She graduated from Sonoma State University with a degree in Communications, and when she’s not creating content for Insurify, she’s exploring Portland, OR with her kids.