Nuts & Bolts: Progressive Insurance is offering loan/lease payoff auto coverage in Texas. Also known as “gap” insurance, loan/lease payoff coverage pays the difference between what a policyholder owes on his or her vehicle and what the comprehensive or collision coverage pays when the vehicle is either declared a total loss, or stolen and not recovered. Insurers calculate the actual cash value (ACV) of vehicles to determine how much to pay in the event of total loss, which makes loan/lease coverage extremely valuable to customers whose loan or lease balances are greater than their autos ‘ ACVs. The coverage is available to new policyholders for passenger vehicles that are leased or financed. Existing policyholders in Texas may add it to their Progressive policy upon renewal. The lien holder must be a financial institution, and policyholder must carry comprehensive or collision coverage on the vehicle.
Dollars: Pays for the difference up to 25 percent of the vehicle’s ACV, as well as the deductible.
States Available: Available in 46 states, including Texas.
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