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Updated June 15, 2022
The only thing worse than a totaled or stolen vehicle is one that you still owe money on. In such instances, guaranteed asset protection (GAP) insurance can cover the difference between the car’s value and what you owe. Gap coverage is optional in many places, but some lenders in Wisconsin and elsewhere require it with every auto loan.
No matter what type of car insurance you need, Insurify helps you get quotes from multiple top insurance companies at once. Just answer a few questions and choose from a list of cheap quotes from a variety of companies. It’s fast, free, and secure.
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Best Companies for Gap Insurance in Wisconsin
How much is gap insurance in Wisconsin?
In Wisconsin, the average cost of car insurance for leaseholders is $201 per month. Your car insurance rate is determined by many factors, including your driving record, credit score, age, even marital status.
Most big insurers, like Allstate, Nationwide, and Progressive, offer gap coverage. In Wisconsin, the following companies had the lowest average rates to insure a leased vehicle. Note that the quotes below are for leased car insurance in general, not just gap coverage.
|Insurance Company||Average Monthly Cost for Leased Cars in Wisconsin|
|Midvale Home & Auto||$154|
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What is gap insurance?
Gap insurance is a type of supplemental policy on top of collision and comprehensive coverage that only applies to situations where your vehicle is stolen or totaled and you owe more than it’s worth. In the event of a “total loss,” gap coverage can help pay off your remaining car loan or lease so that your finances aren’t ruined along with your car.
Gap insurance is not to be confused with collision and comprehensive insurance, together called “full coverage.” Collision insurance pays for repairs when your vehicle is damaged in an accident, and comprehensive insurance covers other damage, such as vandalism, weather, and accidents involving wildlife.
Gap coverage is generally only available for new cars (less than three years old) and in the name of the original lease/loan holder.
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Who should buy gap insurance in Wisconsin?
If you’re leasing or financing your vehicle, your lender might require gap insurance as part of your auto insurance coverage.
Even if you’re not required to buy gap insurance, it could be a good idea if you:
owe more on your lease/loan than the actual cash value of the vehicle
are driving/leasing a new vehicle that will depreciate quickly
made a small down payment (less than a 20 percent)
have a long loan term (60 months or more)
expect to rack up miles on your car (which would speed up depreciation)
Alternatively, gap coverage might not be essential if you made a 20 percent down payment or expect to pay off your auto loan quickly or have mostly done so. In other words, gap insurance might not be worth it if the vehicle is worth more than you owe.
Wisconsin Gap Insurance Laws
The state of Wisconsin does not require gap insurance, but lenders often require it if you’re financing or leasing a new car. This is especially true for types of vehicles that depreciate quickly, like SUVs and luxury cars. Even if gap insurance isn’t required, it could be worth purchasing.
According to the Office of the Wisconsin Commissioner for Insurance, drivers in the Dairy State are required to have three components of auto insurance: liability insurance for bodily injury, liability coverage for property damage, and uninsured motorist coverage, with the following minimum limits:
$25,000 for injury or death of one person
$50,000 for injury or death of two or more people
$10,000 for property damage.
Uninsured motorist coverage of at least $25,000/$50,000 per motor vehicle accident for bodily injury
How much gap insurance do I need in Wisconsin?
You should get enough coverage to pay for the “gap” between what you owe on the vehicle and its actual cash value. But usually, there are two options for gap coverage: policies that cover 25 percent of your car’s value and policies that will fully pay off the loan regardless of the amount. It’s best to do the math and figure out which is better for you.
See More: How Much Car Insurance Do I Need?
How Gap Insurance Works in Wisconsin
It’s not uncommon for people to owe more on a vehicle than its “actual cash value,” or what the used vehicle would sell for. New cars lose value as soon as you drive them off the lot—sometimes as much as 10 percent—and continue to depreciate 15 to 20 percent annually.
So, for example, if you took out a $30,000 loan for a new car but it was totaled in an auto accident the next week, the car could have already lost $5,000 in value, bringing its actual cash value (i.e., what the insurance company would pay out) to $25,000. Because your loan was $30,000, you’d still be $5,000 in debt for a car you don’t have.
Gap insurance, however, would cover the $5,000 difference between the car’s value and what you still owed on the loan. Occasionally, gap policies will also pay the deductible for your comprehensive or collision coverage.
How Much Gap Insurance Costs in Wisconsin
In Wisconsin, the average cost of car insurance for leaseholders is $201 per month.
Your car insurance rate is determined by many factors, including your driving record, credit score, age, even marital status. Your gap insurance would be an additional cost.
Insurers determine the cost of your gap coverage based on your loan amount and your vehicle’s expected depreciation. This means that gap costs more if you have a large loan.
Depending on where you buy your gap coverage, you could encounter either a flat fee or a monthly insurance premium. Expect a flat fee of around $500 to $700 from dealerships and lenders, or if you go through an insurer, around $60 a year.
How to Buy Gap Insurance in Wisconsin
You can buy it one of three ways: from the car dealership, your auto lender, or your insurance company. (The coverage is often called a “gap waiver” if purchased from the dealership or lender, and “gap insurance” if from an insurer.) Your existing insurer might offer the best deal on gap if you add it to your auto insurance policy with them.
If you’re considering purchasing gap coverage through your lender, remember that if you add your coverage to your auto loan, you’ll be paying additional interest on that amount.
You should always get quotes and compare prices before buying an insurance policy; the same coverage might be priced differently at different companies. An easy way to find the best deal on gap insurance is to compare quotes and policies from multiple car insurance companies using Insurify.
Frequently Asked Questions: Gap Insurance in Wisconsin
Other options to consider are loan/lease payoff coverage or new/better replacement car coverage.
Possibly, though the insurer might not let you know, so make sure you understand the details of your plan, keep all your paperwork, and call your insurance company if you have questions.
You might want to start by calling your existing car insurance company and seeing what rate they’d offer you. (Sometimes, companies offer discounts for buying multiple products from them). But always shop around to find the best price in your area. Insurify makes it easy for Wisconsin drivers to get multiple quotes at once.
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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.