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8+ years writing about insurance, taxes, and personal finance
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Licensed auto and home insurance agent
4+ years experience in insurance and personal finance editing
NPN: 20564519
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Licensed property and casualty insurance agent
10+ years editing experience
NPN: 21630969
Updated
Pennsylvania recorded 109,541 traffic accidents in 2025.[1] If a crash totals your car, your insurance company pays only its current market value, not what you still owe on your loan or lease. That can leave a gap between the insurance payout and your balance.
Guaranteed asset protection (GAP) insurance helps cover that difference. If you finance or lease your vehicle, this car insurance coverage can protect you from paying out of pocket for a car you no longer have.[2]
Pennsylvania drivers have an average of $16,600 in total auto debt, according to the Federal Reserve Bank of Philadelphia.
More than 100,000 traffic accidents take place in Pennsylvania each year, and any one of them could total a leased or financed vehicle.
Erie has the lowest average gap insurance rates among Pennsylvania insurers.
Gap insurance costs and availability vary by company, so it’s a good idea to compare options rather than accepting the first quote you receive.
The table below shows three Pennsylvania insurance companies that offer gap insurance, along with the monthly average cost of gap insurance and what each is best for.
Gap Insurance Company | Average Monthly Quote | Best For |
|---|---|---|
| Erie | $2 | Affordability |
| Progressive | $3 | Flexibility |
| Allstate | $4 | Large loans |
| User Reviews | 4.4 |
|---|---|
| IQ Score The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores. | 8.4 /10 |
| Liability Only Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages. | $57/mo |
| Full Coverage Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible. | $96/mo |
Erie Insurance's score | Industry average | |
|---|---|---|
| Coverage options | 4.2 | 3.2 |
| Customer service | 3.7 | 3.6 |
| Discounts | 3.8 | 2.9 |
| Policy transparency | 4.0 | 3.1 |
| Value | 3.7 | 2.9 |
Customers appreciate the insurer’s excellent customer service and quick claim handling but are dissatisfied with the unexpected and unexplained rate increases. Some also found the policy details hard to understand.
Erie Insurance started in Erie, Pennsylvania, more than 100 years ago and still has its corporate headquarters there. Being a local insurer, Erie is familiar with the risks that Pennsylvania drivers face. Erie is also one of the most affordable insurers in the state. Erie’s gap insurance costs about $2 per month in Pennsylvania, according to Insurify data, so you can add loan or lease protection to your policy without a big jump in your bill.
Homegrown Pennsylvania insurance company with a strong regional agent network
Cost of gap coverage is half statewide average of $4 per month
Very high J.D. Power customer satisfaction score in the mid-Atlantic region
Fewer optional add-ons than some larger national insurance companies
Available in only 12 states and Washington, D.C., so it may not transfer if you relocate
Can’t buy a policy online
| JD Power J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale. | 624 |
|---|---|
| IQ Score The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores. | 8.7 /10 |
| Liability Only Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages. | $68/mo |
| Full Coverage Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible. | $143/mo |
Customers appreciate the insurer’s good customer service and initial affordability but dislike the consistent price increases and complex claims process.
Progressive doesn’t have the cheapest full-coverage rates in the Keystone State, but adding on gap insurance is still affordable, at only $3 per month on average. Progressive lets you add loan/lease payoff coverage anytime during your policy term, as long as you have full coverage. That’s a bonus if you finance a car after your policy starts or go underwater on your loan and want the extra protection.
Widely available across Pennsylvania, including rural counties with fewer regional options
Loan/lease payoff costs an average of $3 per month in Pennsylvania
Full-coverage rates lower than the statewide average
Below-average J.D. Power customer satisfaction ranking in the mid-Atlantic region
Payoff capped at 25% of your car’s value
Doesn’t cover additional lease charges, such as excess mileage fees
| User Reviews | 3.8 |
|---|---|
| IQ Score The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores. | 8.9 /10 |
| Liability Only Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages. | $87/mo |
| Full Coverage Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible. | $145/mo |
Allstate's score | Industry average | |
|---|---|---|
| Coverage options | 3.8 | 3.2 |
| Customer service | 3.9 | 3.6 |
| Discounts | 3.8 | 2.9 |
| Policy transparency | 3.7 | 3.1 |
| Value | 3.3 | 2.9 |
Drivers appreciate the friendly customer service and efficient claims processing, but many find the rates too high and experience unexpected price increases. Some also report poor communication from agents.
Allstate’s gap coverage pays up to $50,000 toward your remaining loan balance and up to $1,000 toward your deductible. Those are generous limits for Pennsylvania drivers financing the luxury vehicles common in Philadelphia’s Main Line and in Bucks County. But Allstate’s full-coverage rates are more expensive than some insurers in Pennsylvania.
Available on both new and used cars
High coverage limits protect drivers with larger loan balances
Can cancel coverage any time and receive prorated refund
Must add coverage at time of vehicle financing
Must have full-coverage car insurance to qualify
Costs an average of $4 per month, on par with statewide average
Gap insurance kicks in only after your insurance company declares your car a total loss. Here’s how the process plays out:
File an insurance claim. Depending on your insurance company, you may file a claim with your insurance agent in person, over the phone, or online.
Get a vehicle inspection/claim adjustment. Your insurer inspects the totaled vehicle and calculates its actual cash value (ACV) based on its age, mileage, and condition at the time of the accident.
Receive your initial payout. Your insurance company pays out that ACV, minus your deductible, toward your loan or lease.
Gap insurance kicks in. If you still owe on your loan or lease after the payout, gap insurance covers the remaining balance (up to policy limits) and goes directly to your lender.
Continue to make payments on your loan or lease while your insurance company handles the claim.
Gap insurance in Pennsylvania typically costs between $2 and $7 per month, averaging $4, according to Insurify data. Where you land in that range depends on your insurance company, vehicle, and loan balance.
Erie tends to offer some of the lowest rates on gap insurance in Pennsylvania. The General has the highest average rate for gap coverage in Pennsylvania, at $7 per month.
Full-coverage quotes start at $83/mo.
Gap insurance covers the difference between your car’s actual cash value and your remaining loan or lease balance after a total loss.
Gap Insurance Covers | Gap Insurance Doesn’t Cover |
|---|---|
|
|
It’s important to note that insurance companies generally don’t pay you the gap insurance amount directly. They pay your lender or leasing company.
For example, say your car’s actual cash value is $18,000. But you owe $22,000 on your car loan and have a $1,000 deductible. You total your car in an accident, and your insurer says it’ll pay out $17,000 (your car’s ACV minus your deductible). But that still leaves you owing $5,000 on your lease or loan.
Gap insurance would cover this amount so that you wouldn’t have to pay the remaining loan balance out of pocket.
Having full coverage doesn’t automatically protect you from a loan or lease gap. Full-coverage policies include comprehensive and collision coverage and protect your car from damage. But gap insurance is a separate add-on or stand-alone policy you have to purchase in addition to full coverage.
The table below shows the main differences between full coverage and gap coverage.
Coverage Feature | Full Coverage | Gap Insurance |
|---|---|---|
| Covers repairs | Yes | No |
| Covers loan gap | No | Yes |
| Covers your deductible | No | No |
| Who receives the payout | You or the repair shop | Your lender or leasing company |
Pennsylvania law doesn’t require gap insurance as part of its minimum requirements, but some lenders and leasing companies mandate it as a condition of financing.[3]
Drivers who benefit most from gap insurance include:
Lessees: Some Pennsylvania lease agreements require gap coverage.
New car buyers with a small down payment: A smaller down payment means you owe more relative to your car’s value from day one.
Drivers with loans longer than 60 months: Longer loan terms mean your loan balance might shrink more slowly than your car depreciates.
People who rolled over a car loan: If you transferred your old car’s remaining loan balance into a new vehicle loan, you may have negative equity for a while.
See quotes from top insurers in minutes
Pennsylvania drivers can buy gap insurance from several sources. The cost of gap insurance and its terms vary depending on where you shop.
The following table can help you compare your options and avoid overpaying for the same protection.
Gap Insurance Source | Pros | Cons | Add-On or Stand-Alone? |
|---|---|---|---|
| Car dealership |
|
| Stand-alone policy bundled into your loan |
| Auto insurance company |
|
| Endorsement added to your existing auto policy |
| Bank or credit union |
|
| Stand-alone policy tied to your loan |
| Online insurer |
|
| Stand-alone policy |
It’s normal to have questions about financing, coverage requirements, and cost when buying a car in Pennsylvania. Here are answers to some frequently asked questions to help you decide whether you need gap insurance.
No. Pennsylvania doesn’t legally require gap insurance. But many lenders and leasing companies require it as a condition of your loan or lease agreement. Check your financing terms before assuming it’s optional for your specific situation.
If a covered loss totals your car, your insurance company pays its actual cash value, minus your deductible. If you still owe more than that payout on your loan or lease, gap insurance covers the remaining balance, up to your policy’s limits.
Adding gap coverage to your car insurance policy typically costs between $2 and $7 per month in Pennsylvania, according to Insurify data. Your cost depends on your insurance company, the type of vehicle you drive, and your driving history.
You can buy gap insurance through your car insurance company, a dealership, your bank or credit union, or an online insurer. Adding it to your existing policy is often the cheapest option.
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8+ years writing about insurance, taxes, and personal finance
Certified public accountant
Featured in
Licensed auto and home insurance agent
4+ years experience in insurance and personal finance editing
NPN: 20564519
Featured in
Licensed property and casualty insurance agent
10+ years editing experience
NPN: 21630969
At Insurify, our goal is to help customers compare insurance products and find the best policy for them. We strive to provide open, honest, and unbiased information about the insurance products and services we review. Our hard-working team of data analysts, insurance experts, insurance agents, editors and writers, has put in thousands of hours of research to create the content found on our site.
We do receive compensation when a sale or referral occurs from many of the insurance providers and marketing partners on our site. That may impact which products we display and where they appear on our site. But it does not influence our meticulously researched editorial content, what we write about, or any reviews or recommendations we may make. We do not guarantee favorable reviews or any coverage at all in exchange for compensation.
