The Top 5 Companies to Buy Gap Insurance From
Last Updated on December 11, 2025
Gap insurance (also called “Guaranteed Asset Protection” or loan/lease payoff coverage) can protect you from owing money on a car you no longer have.
Here’s the problem it solves: if your car is totaled or stolen, your insurer typically pays the actual cash value of your vehicle (ACV), minus your deductible. But your loan/lease balance can be higher than ACV—especially early in the loan or if you rolled negative equity into the deal.
Gap insurance covers the difference between the actual cash value of your vehicle and what you still owe on your loan or lease. In some leases, gap coverage is already included as a “gap waiver,” but not always, so it’s worth confirming before you buy anything.
Many major car insurance companies sell gap-style coverage, but some—like GEICO and State Farm—generally don’t offer traditional gap insurance as an auto policy add-on (they may point customers to dealership/lender options or similar programs).
Below are five of the best places to buy gap insurance (or a gap-equivalent add-on), plus how to decide if you actually need it.
Key Takeaways
- Gap insurance helps pay the difference between your car’s actual cash value (ACV) and what you still owe on a loan or lease after a total loss or theft.
- Many leases already include a “gap waiver,” but not all—check your lease or lender paperwork before buying separate coverage.
- Insurer “loan/lease payoff” add-ons can be cheaper than dealership GAP, but they may have stricter payout caps and exclusions.
- Gap insurance is most valuable when you have a small down payment, long loan term, or rolled negative equity—situations where you’re more likely to be upside down.
How Does Gap Insurance Work?
Gap insurance (loan/lease payoff coverage) helps when your vehicle’s value drops faster than your loan balance.
Example: You owe $32,000 on a loan. Your car’s ACV at the time of a total loss is $28,000, and you have a $1,000 deductible. Your collision or comprehensive claim might pay $27,000 (ACV minus deductible). Without gap coverage, you could still owe $5,000 to your lender. Gap coverage is designed to pay that difference (up to the policy’s limits).
In summary, here’s how gap insurance works:
- Gap insurance applies to a car you own, lease, or finance (it’s most useful when you have a loan/lease balance)
- If your car is totaled or stolen, you file a claim under your comprehensive or collision insurance (depending on the cause)
- If you owe more than the insurance payout for the totaled/stolen vehicle, gap coverage may pay the difference (subject to limits)
What Gap Insurance Usually Doesn’t Cover
Gap coverage is helpful, but it isn’t a blank check. Most policies/waivers won’t cover things like:
- Routine repairs or mechanical breakdowns (gap only matters after a total loss/theft)
- Overdue payments, late fees, or penalties
- Excess wear-and-tear charges, mileage penalties, or other end-of-lease fees
- Negative equity beyond the plan’s payout limit (some insurer add-ons cap benefits as a percentage of ACV)
Where to Buy Gap Insurance (and Why It Matters)
You can usually buy gap coverage in three places: (1) your auto insurance company, (2) your dealership at purchase, or (3) your lender/credit union.
In many cases, the most affordable option is adding it to your car insurance policy—but dealership/lender gap can sometimes cover a larger amount (and may include deductible reimbursement). The “best” choice depends on your loan size, down payment, and how the coverage is capped.
If you already bought gap through the dealership and later realize you don’t need it (or you found a cheaper option), you may be able to cancel and receive a prorated refund for unused coverage—rules vary by provider and state. Learn more: https://www.experian.com/blogs/ask-experian/gap-insurance-refund/
Best 5 Gap Insurance Companies in the United States
Not every insurer offers gap coverage, and availability varies by state and vehicle. Here are five strong options to consider:
1. Progressive
Progressive offers gap-style coverage called “loan/lease payoff.” It’s designed for drivers who want gap protection directly on their auto policy (instead of buying it through a dealer).
What to know: Progressive’s loan/lease payoff benefit is commonly capped (often described as up to a percentage of the vehicle’s value, and limits can vary by state). It also typically won’t cover extra loan/lease charges like excess mileage fees.
Learn more about Progressive loan/lease payoff coverage: https://www.progressive.com/auto/insurance-coverages/loan-lease-payoff/
2. Allstate
Allstate is widely known for its dealership-sold Guaranteed Asset Protection (GAP) product through Allstate Vehicle Protection (availability and terms vary by dealer/lender/state).
What to know: Allstate’s dealership GAP is often marketed with features like deductible reimbursement (commonly up to $1,000) and a maximum waived balance for a covered total loss. If you’re buying gap at the dealership, this is one of the more recognizable programs you’ll see.
Learn more about Allstate Guaranteed Asset Protection (GAP): https://vehicleprotection.allstate.com/products/guaranteed-asset-protection
3. American Family
American Family offers loan/lease gap coverage as an optional add-on in select states. This can be a good fit if you prefer buying gap coverage from your insurer (instead of rolling it into your loan at the dealership).
What to know: Like most insurers, you’ll typically need comprehensive and collision coverage for gap protection to apply. Coverage details and eligibility can vary by state.
Learn more about American Family loan/lease gap coverage: https://www.amfam.com/insurance/car/coverages/lease-and-loan-insurance
4. Amica
Amica is a popular pick for drivers who care about customer experience and want a straightforward add-on for auto loan/lease protection.
What to know: Amica describes this as Guaranteed Asset Protection (GAP) / auto loan-lease coverage. As with other insurers, eligibility and pricing depend on your state, vehicle, and how your policy is set up.
Learn more about Amica GAP insurance: https://www.amica.com/en/resources/auto/coverage/gap-insurance.html
5. Nationwide
Nationwide offers gap insurance as an optional add-on on eligible vehicles, and it’s a solid option if you want to keep everything bundled with your auto policy.
What to know: Nationwide’s gap coverage is meant to address the loan/lease balance after a total loss. Details can vary, so review how deductibles and payout limits work for your specific policy.
Learn more about Nationwide GAP insurance: https://www.nationwide.com/personal/insurance/auto/coverages/types/gap
Should I Buy Gap Insurance? Do I Need Gap Insurance?
Gap insurance can be worth it in the right situation, but it isn’t for everyone. It also does not cover everything, and it may not be available for all vehicles (it’s often easiest to get on newer vehicles, new loans, and certain loan-to-value ranges).
Gap insurance is most useful if:
- You are leasing or financing a car (some lessors/lenders require it, and many leases include it—confirm your paperwork)
- You rolled negative equity from your last car loan into the new loan
- You made a small down payment (often under ~20%)
- Your car loan is long (often 60–84+ months), which can keep you “upside down” longer
- You drive a lot of miles or you bought a vehicle that tends to depreciate quickly
On the flip side, if you made a large down payment, your loan balance is already below the car’s value, or you could comfortably pay the difference out of pocket after a worst-case total loss, gap coverage may not be necessary.
FAQs on Gap Insurance
Final Word – Best Companies for Gap Insurance
Gap insurance fills a very specific (and very expensive) hole: the difference between what your car is worth and what you still owe after a total loss or theft.
It’s commonly purchased through your car dealership, but you may also be able to buy a gap add-on through your insurer (often called loan/lease payoff). Before you buy anything, confirm whether your lease already includes gap coverage (many do): https://www.federalreserve.gov/pubs/leasing/resource/different/gap.htm
Dealers like CarMax and Carvana may offer gap products, and you can also check your policy declarations page to determine whether you already have gap insurance.
If you’re comparing options, focus on three things: (1) the payout cap/limits, (2) whether deductible reimbursement is included, and (3) whether the coverage is portable if you refinance, switch insurers, or sell the vehicle.
