How much is gap insurance in New Hampshire

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Gap insurance costs $1,327 annually in New Hampshire, which is $570 less than the national average.

Offered by many leading insurers, such as Auto-Owners and The Hanover, gap insurance serves as a financial safety net for drivers who finance or lease a car. It bridges the gap between the vehicle’s actual cash value and the outstanding balance owed on an auto loan or lease if the car is declared a total loss, such as after an accident or theft. Your insurer may also call it loan or lease gap coverage.

Gap insurance rates vary by location, but in New Hampshire, you can expect to pay around $1,327 annually, which breaks down to about $111 each month.

What is gap insurance?

Gap insurance is optional vehicle insurance coverage that helps pay off an auto loan or lease if your vehicle is totaled or stolen and you owe more than the car’s depreciated value.

Most car buyers finance their vehicles by taking out a loan. But it’s easy to forget that cars depreciate as soon as they’re driven off the lot. Often, owners are driving vehicles that are worth less than what they owe their finance company.

If that car is totaled, the owner’s comprehensive or collision insurance reimbursement will be based on the vehicle’s actual cash value, not the loan balance. If the actual cash value is below the loan balance, the owner is responsible for the difference.

However, gap insurance can make up the difference.

“When an accident or theft occurs, a driver usually gets paid out on the vehicle’s cash value from their standard insurance coverage,” says Richard Howe, a car accident attorney in Atlanta. “However, without gap insurance, you will still be on the hook for the remaining amount in your agreement. Gap insurance provides peace of mind to drivers that they will be financially protected.”

“For instance, let’s say your car is totaled and the actual cash value is determined to be $15,000. However, you still owe $20,000 on your loan. Traditional auto insurance would only cover up to the actual cash value, leaving you with a $5,000 deficit,” says Howe.

“But if you have gap insurance, this difference would be covered, relieving you of the financial burden.”

Average cost of gap insurance in New Hampshire

What you pay for gap insurance will depend on your carrier, the state you live in, the make and model of the car you insure, as well as other factors. The average cost of gap insurance in New Hampshire is $1,327 per year, or $111 per month.

“Gap insurance is an optional coverage that is usually very reasonably priced, typically less than $100 per year in additional premium when added as an endorsement to your existing auto insurance policy,” says Mark Friedlander, senior director of media relations at the Insurance Information Institute (Triple-I), an insurance industry trade group.

“Gap insurance rates are based on the amount of your loan or lease agreement. It is typically not based on other common rating factors such as credit record.”

Cheapest gap insurance companies in New Hampshire

In New Hampshire, Auto-Owners provides the most affordable gap insurance, at $846 per year or $71 each month. On the other hand, Farmers has the highest premiums at $2,061 annually or $172 monthly.

The chart below shows the average annual cost of gap insurance from various insurers in New Hampshire.

How much is gap insurance per month in New Hampshire?

Gap insurance costs differ, but here’s what you might pay each month:

Gap insurance rates in New Hampshire’s top cities

Gap insurance rates often depend on your location. The table below lists the average annual costs in major metro areas across New Hampshire.

Gap insurance rates for different vehicle types

The type of vehicle you drive is a key factor insurers use to determine your gap insurance rate.

“Luxury cars, sports cars, and SUVs – typically with higher purchase prices – might also come with higher gap insurance premiums. That’s because these vehicles tend to depreciate at different rates compared to standard sedans or compact cars, posing a greater risk to insurers,” Howe says.

Your vehicle’s age is one of the important factors that can influence gap insurance rates.

“Newer vehicles, which depreciate more rapidly in the first few years, represent a higher risk for insurers offering gap coverage. As a result, a brand-new car might attract a higher gap insurance premium compared to a model that is several years old,” Howe says.

“This reflects the insurer’s risk assessment, considering the steeper depreciation curve and the greater likelihood of a significant gap needing coverage soon after the purchase.”

When does gap insurance expire?

It’s a good idea to keep gap insurance for as long as you’re financing or leasing your vehicle, since it protects you from owing more than the car’s depreciated value.

“However, gap insurance is typically most relevant during the first few years of new car ownership,” Howe says.

That’s usually when you owe more on your loan than the car is worth.

“Most car buyers benefit from gap insurance when the vehicle is less than three model years old. This coverage is usually aligned with the duration of the car loan or lease, often making it unnecessary beyond a few years because the loan balance decreases to fall below the car’s actual cash value,” Howe says.

You can cancel gap coverage once your loan balance dips below the car’s actual cash value. Many insurers automatically end the coverage after a set number of years for the same reason.

Where to buy gap insurance

There are three main ways to get gap coverage, and each has its own pricing and rules.

• Your insurance company: Many national and regional car insurance companies offer gap coverage as an optional add-on to your auto policy, usually for $20 to $40 a year. Since it’s part of your car insurance policy, you can drop it once your loan amount is lower than the car’s actual value.
• Dealership: Many finance managers offer gap insurance, usually for $400 to $700. The charge is added to your loan, which makes it easy, but you’ll likely pay more in the long run because of the added interest amount.
• Banks and credit unions: Some banks and credit unions sometimes sell gap insurance as a standalone policy. It’s typically affordable, but cancellation policies differ – some will refund any unused premium, while others won’t.

Before you buy gap insurance, compare rates, check cancellation policies and look for perks such as deductible reimbursement. Shopping around can help you save big over your loan or lease term.

The bottom line

Gap insurance offers valuable peace of mind for drivers with financed or leased cars, especially during the first few years when depreciation outpaces loan repayment. Because rates vary based on where you live, your vehicle, and other personal factors, comparing quotes from different insurers is essential.

Weigh the cost against the potential risk, and ask your insurer or agent to clarify any details. Making an informed choice now can help you avoid financial stress later.

Methodology

Insure.com commissioned Quadrant Information Services in 2023 to get annual and monthly gap insurance rates for male and female drivers aged 40 who drive a Honda Accord LX with a clean driving record and good insurance score and carry a full coverage car insurance policy with limits of 100/300/100 and $500 comprehensive/collision deductibles.

To evaluate the rates, we have compared 53,409,632 insurance records from 170 insurance companies across 29,152 cities and 34,588 ZIP codes across the nation.

Shivani Gite

Contributing Writer

 

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Shivani Gite is a personal finance and insurance writer with a degree in journalism and mass communication. She is passionate about making insurance topics easy to understand for people and helping them make better financial decisions.