How do I know if I need Loan/Lease Payoff coverage?
Compare what you owe on your vehicle (available from your lender or lessor) to the actual cash value of your vehicle. If the amount you still owe is higher than the actual cash value, the difference might not be covered by your insurance.
How can I determine the actual cash value of my vehicle?
A vehicle's actual cash value is determined by evaluating a number of factors, including the vehicle's age and condition prior to the loss, as well as any prior damage, improvements, or special equipment. Do some research in your area to see the sales price of vehicles similar to yours. You can also access edmunds.com or yahoo.com to get a general idea of your vehicle's actual cash value.
Am I eligible for Loan/Lease Payoff coverage from Progressive?
If you are a new or existing Progressive customer, you can purchase Loan/Lease Payoff coverage for vehicles that you lease or for which you have an unpaid loan. This coverage is only available if your loan or lease is held by a financial institution, not an individual. You must have Comprehensive and Collision coverage, as well.
How much will Loan/Lease Payoff coverage cost?
The actual premium will vary according to the type of vehicle insured.
Is there a dollar limit on the payoff?
After your Comprehensive coverage or your Collision coverage has paid you the actual cash value for your vehicle, less your deductible, your Loan/Lease Payoff coverage will pay the difference between the actual cash value and any additional amount you owe under the terms of your vehicle lease or loan (excepting fees and charges). However, the payment made under this coverage may not exceed 25 percent of the actual cash value.
How do I know when to drop this coverage?
If you purchase Loan/Lease Payoff coverage, you will receive an annual notice beginning three years after you purchase your policy. The notice informs you that you may no longer need the coverage, which you can drop from your policy.
Why wouldn't my insurance company just pay off the loan or lease?
Insurance companies do not ordinarily pay more than the actual cash value of the vehicle. If you owe more on your vehicle than the actual cash value, Loan/Lease Payoff coverage would provide you with protection for the difference.
Can I get this coverage from my dealer or lender?
Some dealers and lenders offer Loan/Lease Payoff coverage, but coverage through Progressive is billed as part of your total insurance premium. The claims process would be easier if you add this coverage to your existing policy because you would only have to deal with one company and one claims representative in the event of a loss.
Does Progressive offer Loan/Lease Payoff coverage in my state?
This coverage is offered in all states except New York and North Carolina. Progressive also offers Loan/Lease Payoff coverage in Washington, D.C.