Best Cheap Gap Insurance Companies in Washington: Quotes, Discounts (2023)

If you have a new car, you might need a more robust insurance policy that includes gap insurance. However, not all insurance providers in Washington offer gap insurance, and prices vary from one provider to the next. If you’re looking for cheap gap insurance in the Evergreen State, your best bet is to compare insurance quotes from multiple companies with Insurify.

Best Companies for Gap Insurance in Washington

We wanted to know which companies provided the lowest rates for gap coverage in Washington. So we compared thousands of quotes for car insurance policies with gap coverage in the state. Below are our findings from least to most expensive.

What is gap insurance?

The official name for gap insurance is guaranteed asset protection. It’s an inexpensive car insurance policy that covers you only when your vehicle is totaled. It specifically covers the leftover payment obligations you have on your vehicle after your insurance payout.

A vehicle is totaled when it sustains damages, usually in a car accident, that exceed the value of the vehicle. When you total a car, the maximum benefit your insurance company pays is the car’s actual cash value—i.e., what it is currently worth on the market. If there’s a loan on the car, that money is paid to the lender. If the car is on lease, the money is paid to the lessor.

If your loan balance is greater than the actual cash value of your car—or if you haven’t finished your leasing term—you’ll still owe money on the car. This is where a gap insurance policy kicks in. It covers the difference so you don’t have to.

Often, when you buy a new vehicle from a car dealership, the dealer will recommend gap insurance. But for some drivers, a gap policy isn’t worth it. Up next is how to know who gap policies are best suited to.

Who should buy gap insurance in Washington?

Drivers who own a car worth less than the remaining balance of their car loan (that is, they’re underwater) should absolutely buy a gap insurance policy. You can find yourself underwater easily, as vehicle depreciation happens quickly. Drivers of leased vehicles should also purchase a gap policy.

The reason why is because a gap policy is inexpensive but offers you thousands of dollars in protection. When your car is totaled, a bunch of fees and expenses come your way. You may have to cover:

• Towing costs

• Rental car or public transportation costs

• New down payment on a car loan

• Title fees and registration of a new car

Paying several hundred or several thousand dollars to cover shortages with your lender or lessor adds to your stress as well as your bottom line. And for some drivers, that shortage can cause serious financial setbacks. Costing less than $5 a month, gap coverage allows you to avoid the extra headache.

Washington Gap Insurance Laws

In Washington state, gap insurance is not required by law. Instead, lenders, lessors, and drivers are left to decide if a gap policy is needed. Lenders and lessors (a.k.a. leasing companies) can require a gap policy as part of the loan or lease agreement. And drivers can add a gap policy if they desire the coverage.

The state minimum for car insurance in Washington includes:

• $25,000 bodily injury per person

• $50,000 bodily injury per accident

• $10,000 property damage per accident

Of course, there are many valuable coverage options beyond minimum coverage that you should consider adding to your policy. These include collision coverage, comprehensive coverage, underinsured and uninsured motorist protection, personal injury protection, and gap insurance.

We should also note that your lender or lessor may require you to carry additional coverage beyond gap insurance, like collision and comprehensive coverage.

How much gap insurance do I need in Washington?

It’s fairly easy to determine exactly how much gap insurance you need. You should determine your coverage limits for gap insurance in one of two ways. For a financed vehicle, subtract the actual cash value from the loan balance. For a leased vehicle, multiply the monthly payment amount by the number of months left on your lease. The equation looks like this:

You can access the actual cash value of your vehicle by looking it up with Kelley Blue Book. If you’re unsure about the remaining balance on your loan, speak with your lender.

How Gap Insurance Works in Washington

Washington gap insurance is pretty straightforward. In the event of a gap insurance claim, your gap policy pays out quickly. With a lease, your insurance company will pay out your leftover lease obligations. Often, this is paid directly to your lessor. You should speak with your claims representative to understand exactly how and when your lessor will be paid.

With a loan, your insurance company pays whatever balance is left (up to coverage limits) after the liability, collision, or comprehensive coverage has paid out. In most cases, you will receive a reimbursement check for this amount in the mail. The check will be made payable to you and your lender. You should speak with your lender about how to deposit your check against your remaining loan balance.

How Much Gap Insurance Costs in Washington

The average Washington driver pays around $265 a month for car insurance with a gap policy attached to it. But to be clear, the gap coverage portion of that premium is quite small. Gap coverage typically costs between $10 and $20 a year, or less than $2 a month. That’s what makes gap coverage so valuable: it costs so little for so much coverage.

How to Buy Gap Insurance in Washington

If you want to find affordable gap insurance coverage in Washington, you’ve got to use Insurify. Insurify’s rate-comparison tool is a fast and confidential way to compare quotes for auto insurance policies that include gap coverage. One form lets you compare six or more insurers. Plus, if you have additional questions, you can speak with one of our qualified insurance agents.