: You drive significantly more than average, which accelerates the car's loss of value. When You Can Skip It You likely do not need gap insurance if: Should You Buy Gap Insurance for Your New Car?

Buying gap insurance is a strategic financial decision that depends on whether you are "underwater" on your vehicle loan—meaning you owe more to your lender than the car is actually worth.

: Gap insurance pays the remaining debt to your lender so you aren't stuck paying for a car you no longer own. When You Should Buy It

: You rolled debt from a previous vehicle into your new car loan.

: If your car is stolen or totaled, standard comprehensive insurance only pays the current market value.

Guaranteed Asset Protection (GAP) insurance covers the "gap" between your car's and your outstanding loan or lease balance .