Is GAP insurance the new PPI?

vix0112

I was sold this today as part of my new car deal but don't feel I need it - Is it just the new PPI???

emmell

It's the latest way for car salesmen to squeeze more profit out of you along with paint and upholstry treatments, probably adds about another £1k to the purchase price.
ML.

crampo_2

vix0112 wrote: »

I was sold this today as part of my new car deal but don't feel I need it - Is it just the new PPI???

Gap Insurance pays you out from where the insurance company value your car to what you paid for the car (minus the shipping)

So for instance you just brought a car for £15,000 ( Car Value itself )

Gap Insurance normally Lasts 3 years and stays with the owner and the car.

So say 1 year down the line you have a major accident and the insurance company say well at this time if you car was in good condition your car is worth £10,000 then gap insurance steps in and pays you the other £5,000.

Gap Insurance normally costs around £300 - £400 and Is Very Well worth it.

adamc260

crampo wrote: »

Gap Insurance normally costs around £300 - £400 and Is Very Well worth it.

If you google it you can find it from anywhere between £50-100

crampo_2

adamc260 wrote: »

If you google it you can find it from anywhere between £50-100

You probably can. Just with the past cars i have brought the Gap Insurance is around £300 - £400 Pound, But thats probably through a dealer price.

adamc260

Everything is more expensive at a dealer and half the time the cover isn't as good as you can get for half the price

vix0112

crampo wrote: »

Gap Insurance pays you out from where the insurance company value your car to what you paid for the car (minus the shipping)

So for instance you just brought a car for £15,000 ( Car Value itself )

Gap Insurance normally Lasts 3 years and stays with the owner and the car.

So say 1 year down the line you have a major accident and the insurance company say well at this time if you car was in good condition your car is worth £10,000 then gap insurance steps in and pays you the other £5,000.

Gap Insurance normally costs around £300 - £400 and Is Very Well worth it.

From what I can see the GAP insurance pay's the CURRENT finance left on the car - should you write it off.
Not the difference between the current value & what you actually paid for the car.
In my experience the outstanding finance is never likely to be far from the current value.
Plus your car should be insured at it's market value and this is normally what your insurance would pay out?

Hence the reason that I'm saying I don't think I need it?
I don't understand why it's needed?

wornoutmumoftwo

Gap insurance has been around for ages. I used to work for a finance company about ten years ago and it was sold then.

dacouch

vix0112 wrote: »

From what I can see the GAP insurance pay's the CURRENT finance left on the car - should you write it off.
Not the difference between the current value & what you actually paid for the car.
In my experience the outstanding finance is never likely to be far from the current value.
Plus your car should be insured at it's market value and this is normally what your insurance would pay out?

Hence the reason that I'm saying I don't think I need it?
I don't understand why it's needed?

You get different types of Gap cover, some pay off the difference between your motor insurers settlement and your finance. (This can often be a large amount especially if your on a high APR). There are also types of GAP (RTI or Back to Invoice) which pay out to top up the motor insurers settlement back to the original purchase price.

If you have bought gap from a dealer you have paid well well over the going rate, in addition they will have added the cost to your finance so you will be paying interest on the premium for the duration of your finance period. As stated before you can buy gap cover on the internet for a fraction of what the dealer is charging you.

It should be possible for you to cancel the GAP cover under the 14 day cooling off period.

Is your car a brand new car?

vix0112

dacouch wrote: »

You get different types of Gap cover, some pay off the difference between your motor insurers settlement and your finance. (This can often be a large amount especially if your on a high APR). There are also types of GAP (RTI or Back to Invoice) which pay out to top up the motor insurers settlement back to the original purchase price.

If you have bought gap from a dealer you have paid well well over the going rate, in addition they will have added the cost to your finance so you will be paying interest on the premium for the duration of your finance period. As stated before you can buy gap cover on the internet for a fraction of what the dealer is charging you.

It should be possible for you to cancel the GAP cover under the 14 day cooling off period.

Is your car a brand new car?

It's a year old so not brand new and it's on finance.
I told them I didn't want GAP cover and they told me it was 'in the package'
When I had a good read & seen I can cancel I thought I'd just do that as they have basically lied!

emmell

A garage will possibly charge you double what the gap costs, same with warrantys, same with paint treatment. If you need these things take them out but independently. Any garage that makes you take extras is surely breaking the law.
I would search for a better deal and cancel the garage one (that's if you still want gap).
ML