Dear All, I need your assistance. My dealer representative is uncertain, and I am receiving conflicting information.
Anybody who knows whether GAP insurance is already a part of a BMW lease in Canada or whether I have to get it separately from my insurance company?
GAP insurance is automatically included with BMW leases. Remember that GAP insurance only kicks in when your car is declared a total loss.
Thanks. Everyone keeps stating this. However, no one I’ve talked to in Canada can provide me with the proof of this. All of the information on the websites and news sections comes from US sources. Additionally, this isn’t included as a part of their leases on the website for BMW Financial Services. It’s also not shown on my bill of sale.
I’m therefore surprised that BMW doesn’t emphasize this benefit more in its marketing given it is so evident.
Quote:
You can ask BMW Financial Services for clarification when you sign the lease. It is included in my lease under the heading “17 VEHICLE DAMAGE OR LOSS.”
It’s helpful to have this information! With my current X5, I believe the insurance representatives advised me to purchase “new car” replacement insurance. Therefore, I assume that adding that extra insurance on a lease has no value at all.
Not necessary GAP is covered with the lease, according to the bmw finance representative I spoke with today.
In This Article...
SERPRESULT
Although GAP insurance is not necessary for financing a purchase, it is nevertheless a smart option in case of an emergency, like a total loss.
In the event of a tragedy, such as a totaled car, GAP insurance helps to pay the gap between the real worth of a car and the remaining amount owed on finance.
Guaranteed Auto Protection from BMW (GAP)
When it comes to gap insurance, each automaker takes a different tack. While all insurance are fundamentally the same, some offer extra benefits like deductible coverage and dealer credit.
As promised, the advantages of BMW Guaranteed Auto Protection are as follows:
- coverage for the “gap” caused by a total loss up to $50,000
- Coverage for the main insurance deductible of $1,000
- Up to 150% of the vehicle’s MSRP/NADA value is covered.
- up to 84 month agreement lengths are covered
Due to a number of variables, including the rising popularity of leasing and expensive ownership costs, the value of BMWs and luxury vehicles in general is declining quickly. We advise getting gap insurance until you’re certain that your BMW loan won’t result in you going into negative equity.
This kind of coverage is also relatively inexpensive, with annual costs as low as $20, so it is worthwhile. However, some dealerships do provide gap insurance, albeit it is usually expensive and requires a one-time payment of $400 to $700.
How does BMW gap protection work?
GUARANTEED. AUTO DEFENSE. Your primary insurance provider might only reimburse you if your BMW is determined to be a total loss as a result of an accident, theft, or natural disaster in an amount equal to their estimation of the market value of your car at the time of the total loss, less your deductible amount.
Do tires come with a BMW lease?
Leasing a car is an alternative to getting dealer or bank financing and paying cash for a car. Except for parts like tires, every aspect of your vehicle’s upkeep is covered by the lease payment each month. Your lease contains particular clauses that address the condition and kind of tires that are permitted for your BMW.
Does Gap provide leasing cars?
Purchase: Gap Insurance. Lease agreements frequently contain gap coverage. If not, it is available for purchase. Finance agreements often do not contain gap coverage, but it can be acquired.
Do most individuals lease BMWs?
Among the BMW vehicles that our clients most frequently decide to lease are the 3 series, 5 series, X1, and X5 (shown).
Cartelligent can assist you in finding a fantastic price on any new car, whether you’re looking for an electric vehicle, plug-in hybrid, hybrid, or any other type. To get started, contact our team of car-buying professionals at 888-427-4270.
A blown engine is it covered by Gap Insurance?
Engine breakdown is not covered by gap insurance, no.
An auto insurance policy may contain gap insurance as an optional coverage. The difference between the book value of your totaled car and the balance you still owe on it will be covered if you have gap insurance. If automobile owners who finance or lease their vehicles are concerned about going “upside down” on their loan or lease if the car is totaled in an accident, they might think buying gap insurance.
This extremely specialized coverage only kicks in when you owe more than the automobile is worth and your car is totaled in a covered claim. Engine failure, typical wear and tear, or other mechanical issues with your car are not covered by it.
What does gap insurance serve?
Guaranteed Asset Protection Insurance is known as Gap Insurance. In the case of a covered incident where their automobile is deemed a total loss, it is an optional add-on policy that can assist some drivers in filling in the “gap” between the financed amount owed on their car and their car’s actual cash value (ACV).
Imagine being involved in a serious accident where your car sustains significant damage. When you take your car to the repair, you discover that it is totaled. Although you have collision coverage, there is a problem. Your vehicle is three years old and barely worth $20,000 in actual currency. You still owe $25,000 on it, though! Gap insurance will cover the cash gap you need to fill for you (minus your deductible). Contrary to popular perception, gap insurance coverage does not imply that your insurance company will reimburse you for the entire amount you spent on your car at the time of purchase. If you have gap insurance, your insurance company may pay the amount you now owe on your automobile, less your deductible, in the event of a covered accident. Gap insurance might be a wise addition to your collision insurance coverage, depending on your specific situation.
Does gap insurance provide any cash back?
The cutoff date for GAP insurance refunds may vary depending on the insurance company, but typically you can be eligible for a refund at any time before the policy period ends. You might be eligible to ask for a refund, for instance, if you buy a GAP coverage that is supposed to last 36 months but you decide to cancel after 24 months.
How much will gap insurance cover in total?
Although the terms loan/lease coverage and gap insurance are sometimes used interchangeably, they typically don’t refer to the same coverage. The actual cash value (ACV) paid out by your auto insurance company will be less the amount you still owe on a vehicle, and the gap insurance will cover the difference.
Usually, lease/loan coverage has a cap on how much it will pay out, such as 25% more than the estimated ACV of your car. Your deductible is deducted from both.
Let’s say you total your $18,500 automobile with a $500 collision deductible, but you still owe $25,000 on it. There is a $6,500 discrepancy between what you owe and what the item is worth. There is a $6,000 discrepancy after your $500 deductible has been paid.
This total sum would be paid out if you had gap insurance. Only $4,625 would be paid under lease/loan coverage, which covers only up to 25% of the vehicle’s worth ($18,500 x 25% = $4,625). Therefore, if you chose the lease/loan option, you would still owing $1,375.
Run the figures to ensure that lease/loan coverage will work for you. For instance, if the vehicle was worth $20,000 in the aforementioned scenario, 25% of that amount would be $5,000, which is equal to the difference ($25,000 due – $20,000 paid by insurance and your deductible = $5,000), meaning the entire amount would have been covered.
Suppose you purchase a car for $40,000 and have loan/lease coverage that pays 25% more than the automobile’s real cash worth. Eventually, the car loses value and is worth $25,000. After it is deemed a total loss, the maximum you might be compensated is $31,250 less the deductible.
Why do most individuals lease BMWs?
One of the main motives for leasing a BMW is the affordable lease payments, but there are other factors as well. Your Auto Advocate’s Zach and Ray Shefska compiled a useful list of further justifications why people lease BMWs:
- They are depreciating assets: Since you have to pay the depreciation when you lease a car, leasing a BMW is more better than buying one because it will depreciate much more fast.
- You can get a more expensive vehicle with a smaller monthly payment.
- For a BMW, the bumper-to-bumper warranty is for four years or 50,000 miles, and it includes upkeep (except for brakes, tires, and windshield wipers)
- low maintenance expenses
- being able to maintain a manufacturer warranty for the entire lease
- Subvented leases: According to Autotrader, this is when a manufacturer raises the vehicle’s expected future worth, lowering the estimated depreciation and lowering the monthly payments.
Regarding the last point, customers continue to visit the shop to trade in their lease-end vehicle for a new one because BMW subsidized its leases, which explains why the aforementioned lease payments are so low.
Every three years, Ray Shefska explains, “it pulls customers back into the marketplace, making it a terrific business model for the dealerships” (in the video below). “In the same way that 55% of Mercedes and BMW vehicles sold are actually leased, Which is how they want it to be because they want those clients to return.”
What credit score is required to lease a BMW?
In 2020, those who leased a car had an average credit score of around 729. At our South BMW Center, we normally deem a decent credit score for lease approval to be 700 and higher. If your credit score is low, it is still feasible to lease a car, but it will likely cost more.
Do run-flat tires on a BMW lease have to be returned?
You will be charged if you replace the tires if they are not the same size, caliber, or speed rating as your original tires. (The speed rating label is located within the door jam of the car.) A minimum of 4/32 of an inch of depth from the finish tread is required for acceptable wear. You can use your Ding-O-Meter to determine whether or not your tire complies with our rules. With the use of a tire tread depth tester, your local BMW Center will be able to give you a final, more accurate measurement. Additional lease end fees will apply to tires with cuts or gouges. Please take note that if your car had run-flat tires when you bought it, you must return it with run-flats. You will be charged for new tires if you don’t.
What happens if a leased car is totaled while having full coverage?
You will have to continue making your monthly payments even if the accident totals your rented vehicle until the claim is resolved.
The insurance company may declare the vehicle a total loss if the cost of repairs is greater than a reasonable portion of its value. In these circumstances, the insurance provider will reimburse the leasing company for the car’s fair market value.
However, the insurance company’s compensation is frequently lower than the amount that is still owed under the leasing agreement, leaving a shortfall for which you will remain liable. If you have gap insurance, it can aid in covering that shortfall.
Can I offer Carmax my rented BMW?
Yes! You can often sell your leased vehicle in a manner similar to that of any other financed vehicle. We will assess the vehicle, then get in touch with the lease company to get a payment quote and handle any equity you may have.