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Updated June 15, 2022
Gap insurance is a common but often misunderstood type of insurance coverage that’s suitable for a small number of Vermont drivers. For others, it offers no value at all. How do you know if gap insurance is worth it for you? You can get a great deal right now on gap car insurance by using Insurify, the fast and free quote comparison. Low rates are just a few clicks away.
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Best Companies for Gap Insurance in Vermont
How much is gap insurance in Vermont?
The average total cost to insure a car with gap insurance in Vermont is $123 a month. However, what you pay for car insurance will depend on a variety of factors, such as your age and your driving record.
We should note first that not every insurance company offers gap coverage with its car insurance policies. That being said, we reviewed thousands of quotes for car insurance with gap coverage in Vermont. From that data, we were able to determine exactly which companies are offering the lowest rates to their customers. Below is a table of our findings.
|Insurance Company||Average Monthly Cost for Leased Cars in Vermont|
|Midvale Home & Auto||$108|
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What is gap insurance?
Gap insurance is optional auto insurance for people with a loan or lease on their vehicle. If you total your car, gap insurance covers the difference between what you owe on your vehicle and the payout received from your car insurance company. In the first few years of car ownership, your car’s depreciation can outpace the speed at which you pay down your car loan.
When this happens, you owe more than the car is worth. If you total your car during this time, you’ll be on the hook to your lender—unless you have gap insurance or a gap waiver. A gap waiver is an agreement between a lender and borrower where the borrower is not required to pay the remaining balance of a loan in the event of a total loss.
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Who should buy gap insurance in Vermont?
People who have a car loan that exceeds the actual cash value (ACV) of their vehicle should purchase a gap insurance policy. People who lease their vehicle should also purchase one. Gap insurance policies are inexpensive, typically less than $2 a month, but they offer extremely valuable protection in the event that your car is totaled.
Vermont Gap Insurance Laws
Though gap insurance is not required by law, it may be required by your lender or leasing company. In Vermont, lenders and lessors are allowed to require you to carry a gap policy as part of your lease or loan agreement. You can also purchase a gap policy if you want to, even if it’s not required.
As a refresh, we should cover exactly what you’re required by law to purchase. The state minimum car insurance requirements in Vermont are only for liability coverage:
$25,000 bodily injury liability per person
$50,000 bodily injury liability per car accident
$10,000 property damage liability per car accident
How much gap insurance do I need in Vermont?
In short, you need to set your gap insurance coverage limits high enough to cover your leftover financial responsibility if your car is totaled. It’s fairly easy to determine this amount. With a financed car, that means the value left over when you subtract the actual cash value from the remaining balance on your loan.
You can look up the actual cash value of your car by using Kelley Blue Book. Contact your lender to find out the remaining balance on your car loan. With a leased vehicle, you simply multiply your monthly payment by the number of months left in your lease agreement.
See More: How Much Car Insurance Do I Need?
How Gap Insurance Works in Vermont
Gap insurance is paid out during an insurance claim. With a financed car, gap insurance pays out the remaining loan balance after a liability, collision, or comprehensive policy has paid out the actual cash value of the car. How the actual cash value of the car is paid depends on the nature of the accident—it will come from the insurance company of the driver found at fault.
With a leased car, a gap policy pays the leftover monthly payments. This is usually paid directly to your lessor. You should speak with your claims representative about how this is paid out in order to ensure the process moves along as you expect it to.
How Much Gap Insurance Costs in Vermont
The average cost of a car insurance policy with gap coverage in Vermont is $123 a month. However, the cost of the gap coverage portion of the policy is typically less than $5 (maybe even less than $1) a month. Your exact costs will depend on a number of factors, including your driving history and the amount of financial responsibility you owe.
See More: Average Cost of Car Insurance in Vermont
How to Buy Gap Insurance in Vermont
The best way to buy gap insurance in the state of Vermont is to use Insurify. With the Insurify rate-comparison tool, you can compare the cost of car insurance with gap coverage from six or more insurers. Adjust coverage options to get a full picture of your options. And when you find the right price, Insurify makes purchasing the new policy easy.
If you have questions or concerns about which policy is right for you, you can also speak with an Insurify agent. Our licensed insurance agents provide free, unbiased guidance to help you get more from your policy.
Frequently Asked Questions: Gap Insurance in Vermont
Nope. Vermont law and the Vermont department of motor vehicles make no requirements for gap coverage. However, your lender or leasing company can make requirements as part of your loan or lease agreement. And you can almost always opt to purchase a policy without being required to.
In general, you do not get a refund of gap insurance premiums when you pay off your car. The only exception is when you’ve prepaid for coverage but cancel gap coverage before the end of the term. In that case, you’d be refunded the prepaid premiums from the time of cancellation to the end of the coverage period.
The easiest way to get cheap gap insurance in Vermont is to use the Insurify rate-comparison tool. With our tool, you can compare gap car insurance rates anonymously. We use proprietary data and AI technology to produce accurate insurance quotes without sharing any of your personal information. It’s free and easy to use. Only buy when the price is right.
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Data scientists at Insurify analyzed over 40 million auto insurance rates across the United States to compile the car insurance quotes, statistics, and data visualizations displayed on this page. The car insurance data includes coverage analysis and details on drivers' vehicles, driving records, and demographic information. With these insights, Insurify is able to offer drivers insight into how their car insurance premiums are priced by companies.