Gap Insurance in Illinois (2024)

While Illinois law doesn’t require gap insurance, it’s worth considering if you financed or leased your vehicle.

A.M. Steinbach
Written byA.M. Steinbach
A.M. Steinbach
A.M. SteinbachInsurance Writer
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  • Two-time Emmy Award nominee

A Harvard graduate, Mark has worked as a freelance personal finance and tech writer. He’s also written for Saturday Night Live.

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Ashley Cox
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Ashley CoxSenior Managing Editor
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Ashley is a seasoned personal finance editor who’s produced a variety of digital content, including insurance, credit cards, mortgages, and consumer lending products.

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Updated October 30, 2024

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Cheapest recent rates in Illinois

Drivers in and around Illinois have found policies from Safeco, Allstate, Insure on the Spot, and more, through Insurify in the last few days.

*Quotes generated for Insurify users from Illinois within the last 10 days. Last updated on October 30, 2024

Rates shown are real-time Insurify user quotes from 100+ insurance companies and Quadrant Information Services data. Insurify’s algorithm excludes anomalous quotes and anonymizes personal details, then displays refined quotes by price, date, and insurer popularity up to 10 days ago from October 30, 2024. Actual quotes may vary based on the policy buyer’s unique driver profile.

*Quotes generated for Insurify users from Illinois within the last 10 days. Last updated on October 30, 2024

Rates shown are real-time Insurify user quotes from 100+ insurance companies and Quadrant Information Services data. Insurify’s algorithm excludes anomalous quotes and anonymizes personal details, then displays refined quotes by price, date, and insurer popularity up to 10 days ago from October 30, 2024. Actual quotes may vary based on the policy buyer’s unique driver profile.

Gap insurance — short for “guaranteed asset protection” — is an optional form of insurance designed for drivers who lease or finance a vehicle. For example, if your financed car is a total loss after an accident, gap insurance helps ensure you aren’t still on the hook for auto loan payments once your car is unusable.

Several car insurance companies in Illinois offer gap insurance at competitive rates. Read on to learn more about what gap insurance covers, which drivers should buy it, how to buy it, and the best companies for gap insurance in Illinois. And remember to always compare car insurance quotes from multiple companies before buying a policy.

Quick Facts
  • A full-coverage policy in Illinois costs an average of $183 per month. Adding gap insurance typically costs $2 more per month.

  • Auto-Owners, Progressive, and Erie offer some of the best gap insurance in Illinois.

  • Leasing companies usually require drivers to carry gap insurance.

How gap insurance works

It’s just reality: A car loses value the moment you drive it off the lot. 

So, if you finance your vehicle and only made a small down payment at the time of purchase, you can potentially owe more on the car than its actual cash value (ACV). You’re still paying off a loan worth that original purchase price, even as your vehicle has lost value. In this case, you’re “underwater” on your car loan.

Things can get complicated if you get in an accident that badly damages your vehicle. If your car is totaled, standard car insurance policies will cover the car’s market value, which has depreciated since you bought it — but you’ll still owe loan payments on the full price of the car.

That’s where gap insurance comes in. Gap insurance covers the difference between your car’s market value and the remaining loan in the event of a total loss. This coverage ensures you aren’t still paying car payments if you damage your car beyond repair.

Gap insurance is a good idea if you made a low down payment on your car (typically less than 20%) or if your loan term is more than 60 months. Also, anyone who leases a vehicle should consider gap insurance (and lenders sometimes require you to carry gap insurance if you lease a car).[1]

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What gap insurance covers in Illinois

Gap insurance covers the difference between the amount you owe on your car loan and the market value of your vehicle.

For example, say you purchase a car for $30,000. You pay a down payment of $5,000 and owe $25,000 on your car loan. Unfortunately, a few months into your loan, you total your vehicle. At the time of the accident, your car was worth $23,000 — but you still owe $25,000 on your loan, which means you still have to pay $2,000 for a car that’s unusable.

Gap insurance helps you pay this $2,000. Gap insurance differs from other forms of insurance in that it doesn’t have a deductible. So, the insurer will pay out the full claim amount. You shouldn’t have to pay a portion of your remaining loan balance out of pocket.

You don’t want to be on the hook for additional loan payments after a car is totaled. Gap insurance helps you avoid that scenario.

Important Information

Gap insurance only applies to your remaining loan balance. Your gap insurance policy won’t cover the cost of replacing your totaled vehicle with a new one. New-car replacement coverage, which is also optional, provides coverage for the purchase of a new vehicle of the same year, make, and model after your original vehicle is totaled.

Gap insurance also doesn’t cover overdue loan payment fees, lease penalties, or the down payment for a new vehicle after your car is totaled.

Cheapest Auto Insurance in Illinois (2024)

Cheapest Auto Insurance in Illinois (2024)

Best gap insurance companies in Illinois

Several insurance companies in Illinois offer gap coverage. The following companies offer the best combination of low rates and high customer satisfaction scores.

Auto-Owners

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User Reviews
3.8
IQ Score
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
8.5/10
Liability Only
Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages.
$29/mo
Full Coverage
Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible.
$52/mo

Auto-Owners offers the lowest average rates in Illinois, which makes this insurer one of the best options for drivers seeking gap insurance. Speak to your local agent to learn about specific gap coverage rates and whether you’re a good candidate for this add-on insurance.

Pros
  • Above-average J.D. Power customer satisfaction rating in Illinois

  • Multiple discounts

Cons
  • Available in only 26 states

  • Some negative customer reviews on Trustpilot

Read more driver reviews of Auto-Owners
Ronald W - October 29, 2024
Verified

They Cancelled Our Home Insurance

We had no problem with Auto-Owners regarding our auto insurance. However, we were disappointed when Auto-Owners cancelled our home insurance. They stopped all home insurance in 'fire prone areas'.

Martha - October 28, 2024
Verified

Good

The premiums keep increasing.

Lawrence - October 24, 2024
Verified

Honest Answers to Questions

Please refer to my answers to the previous questions.

Progressive

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JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
827
IQ Score
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
8.4/10
Liability Only
Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages.
$45/mo
Full Coverage
Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible.
$107/mo

Progressive offers loan/lease payoff coverage, which helps pay the difference between your car’s value and your remaining loan or lease balance if someone steals your car or you total it. Progressive will pay up to 25% of your vehicle’s value and will send payment directly to your loan or lease provider.

Pros
  • Numerous coverage options and discounts available

  • Rewards for good drivers

Cons
  • Below-average J.D. Power customer satisfaction rating in Illinois

  • Higher-than-expected number of complaints with the National Association of Insurance Commissioners (NAIC) for a company of its size

Read more driver reviews of Progressive
Denise - October 29, 2024
Verified

Awesome!

I haven't had any problems with the company. I am pleased with the work they do.

Priscilla - October 29, 2024
Verified

They Increased My Insurance Payment from $117 a Month to $199 a Month

They are very inconsiderate.

Lisa - October 29, 2024
Verified

Disappointed

They were good until they doubled my monthly payment. My deductible also went up to $1000. At that price, I can fix my vehicle on my own.

Erie

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User Reviews
3.9
IQ Score
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
9.0/10
Liability Only
Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages.
$48/mo
Full Coverage
Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible.
$85/mo

Erie has some of the most affordable rates in Illinois. Additionally, Erie provides gap insurance for only a small increase to your premium — though it won’t cover balances you carry over from a previous loan.

Pros
  • Excellent Better Business Bureau, J.D. Power, and AM Best ratings

  • Competitive rates for teenagers and drivers with speeding tickets

Cons
  • Available in only 12 states

  • Can’t buy a policy or file a claim online

Read more driver reviews of Erie Insurance
Satina - October 28, 2024
Verified

Erie Insurance Unreliable

The service is not good, and they are unclear about some policy benefits like 24-hour towing, which is non-existent but included in the policy.

Lana - October 25, 2024
Verified

Expensive but Efficient Company

Erie provides excellent claims service if you ever need it, but their rates are fairly expensive. I've been with them for 55 years.

Shannon - October 19, 2024
Verified

Could be Better

I had an unfortunate accident and they were very helpful at the time managing the claim, so the company was great. My rate did go up which I expected and it was reasonable at the time. When my policy was supposed to renew the following year, they wanted to again increase my rate by almost $100 per month. The insurance broker I dealt with was very rude when I called about canceling my policy because unfortunately, I can't afford that kind of increase as a single parent with one income.
  • Data scientists at Insurify analyzed more than 40 million real-time auto insurance rates from our partner providers across the United States to compile the car insurance quotes, statistics, and data visualizations displayed on this page. The car insurance data includes coverage analysis and details on drivers’ vehicles, driving records, and demographic information.

    Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Services’ database of auto insurance rates. With these insights, Insurify is able to offer drivers insight into how companies price their car insurance premiums. The data included on this page represent averages across driver ages, genders, credit scores, and driver profiles for Illinois drivers.

Gap insurance vs. full coverage

In Illinois, full coverage refers to an auto insurance policy that includes liability coverage, collision coverage, and comprehensive coverage. Together, it covers repairs to both the other driver’s vehicle and your vehicle in the event of a car accident.

If you purchase full-coverage car insurance, you shouldn’t assume it includes gap insurance. In most cases, you’ll want to purchase gap insurance as a separate add-on coverage. Gap insurance can enhance your full-coverage policy by covering your remaining loan balance if your car is a total loss.

Cheapest recent rates in Illinois

Drivers in and around Illinois have found policies from Safeco, Elephant, Direct Auto, and more, through Insurify in the last few days.

*Quotes generated for Insurify users within the last 10 days. Last updated on October 30, 2024

Rates shown are real-time Insurify user quotes from 100+ insurance companies and Quadrant Information Services data. Insurify’s algorithm excludes anomalous quotes and anonymizes personal details, then displays refined quotes by price, date, and insurer popularity up to 10 days ago from October 30, 2024. Actual quotes may vary based on the policy buyer’s unique driver profile.

*Quotes generated for Insurify users within the last 10 days. Last updated on October 30, 2024

Rates shown are real-time Insurify user quotes from 100+ insurance companies and Quadrant Information Services data. Insurify’s algorithm excludes anomalous quotes and anonymizes personal details, then displays refined quotes by price, date, and insurer popularity up to 10 days ago from October 30, 2024. Actual quotes may vary based on the policy buyer’s unique driver profile.

Who needs gap insurance in Illinois?

Drivers in Illinois must carry liability car insurance, including $25,000 in bodily injury liability per person, $50,000 in bodily injury liability per accident, and $20,000 in property damage liability insurance. But Illinois has no laws requiring drivers to carry gap insurance.[2]

That means gap insurance is an optional coverage that should be considered on a case-by-case basis. Below are a few cases that might call for gap insurance:

  • The Illinois Insurance Association recommends gap insurance for drivers who finance a new car with a long repayment period.[3]

  • Drivers who purchase cars that tend to depreciate quickly — such as a brand-new luxury car — should purchase gap insurance.

  • Drivers who are carrying over negative equity from a previous loan to the loan on their current car should purchase gap insurance.

Gap insurance adds to your monthly car insurance payments, so you should consider it carefully before purchasing. For instance, if you made a sizable down payment and have a short repayment term, you probably don’t need gap insurance. In that case, your car’s actual cash value might still exceed your loan balance, so you’re unlikely to be underwater on your loan.

Additionally, if you own your car outright, you have no need for gap insurance. You won’t have a remaining loan balance after a total loss, so you won’t need insurance to cover the difference.

Talk to your car insurance agent to see if you’re a good candidate for gap insurance. Occasionally, your lender will suggest or even require gap insurance before approval of your loan.

How Much Will Insurance Pay for My Totaled Car? (Full Guide)

How Much Will Insurance Pay for My Totaled Car? (Full Guide)

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How to buy gap insurance in Illinois

You have a few different ways to buy gap insurance. Your car dealership may offer gap insurance to you after you purchase the car, which will be included in the car’s price. You can also purchase it from your auto lender, who will include it in your car loan.

You can also purchase gap insurance as you would any other optional insurance add-on — by speaking to your insurance agent and adding the coverage to your existing auto policy.

Gap insurance in Illinois FAQs

Below, you’ll find answers to some commonly asked questions about gap insurance in Illinois. 

  • Does Illinois require gap insurance?

    No. Illinois doesn’t require gap insurance. Illinois drivers only need to carry liability insurance at the 25/50/20 state minimums.

  • How does gap insurance work in Illinois?

    Gap insurance in Illinois works the same as in any other state. If you total your car or someone steals it, your insurance company will pay the difference between any remaining loan balance and the claim payout. Without gap insurance, you’d be on the hook to cover the remaining loan balance out of pocket.

  • How much is gap insurance in Illinois?

    Gap insurance usually costs about $20 per year, though this varies by company. Contact your local auto insurance agent to figure out the costs of gap insurance. Be sure to ask your agent if your insurer has any payout caps or other limitations you should know about.

  • What are the pros and cons of gap insurance?

    Gap insurance offers guaranteed financial protection to drivers who are financing their vehicles and ensures you won’t be on the hook for the remaining balance on your loan after a total loss. Still, gap insurance adds another monthly expense to your insurance costs — so make sure it’s worth the money before purchasing.

  • Is gap insurance worth it?

    Consider your specific situation before deciding if gap insurance is worth it. If you made a small down payment — for instance, less than 20% of your total loan — and have a loan repayment period, gap insurance is likely worth it. If you’ve paid off most of your loan, it’s unlikely you’ll be severely underwater on your loan, so gap insurance might not be worth it.

Methodology

Insurify data scientists analyzed more than 90 million quotes served to car insurance applicants in Insurify’s proprietary database to calculate the premium averages displayed on this page. These premiums are real quotes that come directly from Insurify’s 50+ partner insurance companies in all 50 states and Washington, D.C. Quote averages represent the median price for a quote across the given coverage level, driver subset, and geographic area.

Unless otherwise specified, quoted rates reflect the average cost for drivers between 20 and 70 years old with a clean driving record and average or better credit (a credit score of 600 or higher).

Liability-only premium averages correspond to policies with the following coverage limits:

  • Bodily injury limits between state-minimum rates and $50,000 per person, $100,000 per accident
  • Property damage limits between $10,000 and $50,000
  • No additional coverage
Full-coverage premium averages correspond to the same bodily injury and property damage limits in addition to:
  • Comprehensive coverage with a $1,000 deductible
  • Collision coverage with a $1,000 deductible

Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Services’ database of auto insurance rates.

Sources

  1. III. "What is gap insurance?."
  2. Illinois Department of Insurance. "Mandatory Vehicle Insurance."
  3. Illinois Insurance Association. "How does 'gap' insurance work?."
A.M. Steinbach
A.M. SteinbachInsurance Writer

A.M. is a Brooklyn-based writer, editor, and content marketing strategist who's worked with major brands in insurance, tech, finance, and healthcare. He also contributes to The Average Joe, a personal finance newsletter that reaches over 250,000 daily readers. Since 2019, he's written for Insurify, breaking down a diverse range of insurance topics into crisp, readable prose.

Ashley Cox
Edited byAshley CoxSenior Managing Editor
Headshot of Managing Editor Ashley Cox
Ashley CoxSenior Managing Editor
  • 7+ years in content creation and management

  • 5+ years in insurance and personal finance content

Ashley is a seasoned personal finance editor who’s produced a variety of digital content, including insurance, credit cards, mortgages, and consumer lending products.

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