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Gap insurance - guide discussion

edited 22 October 2018 at 1:46PM in Insurance & Life Assurance
126 replies 84.7K views


  • MrMick02MrMick02 Forumite
    1 posts
    First Post
    MoneySaving Newbie
    Could not use your MSE25 discount code with ALA today, i contacted them on their webchat service and explained they advised me to clear my browser history and all was good. Very happy with a £40 discount for 2yr cover. Thank you very much
  • Testing123_MSETesting123_MSE Forumite
    1 posts
    First Post
    MoneySaving Newbie
    Great guide, thanks MSE.
    I've just bought a new Mazda CX-5 and the car dealer said he was required by law to offer gap insurance but made it clear it was up to me whether to take it or not.
    The 3-year gap insurance offered by the car dealer was £329.  I went on Click4gap and found insurance for £191, knocked down to £143 with the code on MSE (many thanks for that!).
    But the insurance quotes are not directly comparable.  I didn't see it on the MSE site but a critical decision is the insurance cover limit in the event of a claim.  The dealer offered £15k while I ended up going for £7.5k.  What I did was to look at the 3 year depreciation rate of a Mazda CX-5 which is around 42% or around £11k.  But you won't need that level of cover for the 1st year and around £8k for the second year, with £11k needed for the 3rd year.  I just wanted to smooth the depreciation gap so chose cover in the middle knowing this would be too much for year 1 but not enough for year 3.  That's also based on the fact that I'll have no gap insurance at all from year 4.  So you need to think about how much cover you want as that's a key driver of the insurance cost.
  • Craigy4Craigy4 Forumite
    2 posts
    Tenth Anniversary Combo Breaker First Post
    MoneySaving Newbie
    Took delivery of a contract lease hire yesterday and was offered GAP insurance by the dealership, I was unsure whether to take this so said I would research and confirm. Guide on MSE clarified that for peace of mind I was best to have it than to have not and the links provided to ALA Gap insurance and the added discount made up my mind (25%), a quick call to the company also clarified a few questions for me, really helpful advice from them. End result was a saving of £250 against the price of the dealership.
  • nonexpert44nonexpert44 Forumite
    1 posts
    First Post
    MoneySaving Newbie
    I bought a new car this month on a 3 year PCP lease deal. The dealer quoted £649 for 3 year GAP insurance. I used the MoneySavingExpert site and Code and got a 3 year policy with ALA for £157.50, which was less than a quarter of the dealership price. I did the deal over the phone. All my questions were answered and everything well explained. I hope I never have to claim on the insurance but it certainly represents peace of mind at a good value price.

  • StreeetStreeet Forumite
    277 posts
    Part of the Furniture 100 Posts Combo Breaker
    Can I confirm my understanding with you guys:
    I’ve bought a nearly new car on PCP over 4 years. I have no intention to replace it in the event of total loss. 
    I think value of gap for me is the difference between the insured market value and any outstanding finance.
    Have I therefore got to try and work out my exposure over the term to get the right cover level? I don’t want ‘Return to Invoice’ .. I want something like ‘Return to Finance’.
  • Penelopa.PitstopPenelopa.Pitstop Forumite
    776 posts
    Part of the Furniture 500 Posts
    If you only want to cover shortfall in finance, you buy Gap Finance.
    It's still worth getting return to invoice, because it will get you to the same position, you were, when buying the car. It doesn't matter that you don't want to replace the car. You just get cash and keep it.

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