GAP Insurance (Vehicle Replacement) query

ewen1605

Hello, I'm hoping someone might be more learned in this area than I am.

I purchased a car in 2016 on PCP finance.
The list price was £21,000.
Minus the dealer's offer the cash price was £17,000.
I paid a £1200 deposit and monthly payments thereafter.

I also purchased Total Loss Protection (Vehicle Replacement) which says that it will cover the greater of either the finance settlement or the cost of a like-for-like new replacement vehicle.

The car was stolen last week, so I have had to claim on my insurance.

The finance settlement is £13,000.
The car has been valued at £15,000.
Minus my outstanding premium (was paying monthly) and insurance excess this means my finance will be paid off and I will get a £1,000 cheque from the car insurer.

Now my question is what can I expect from my GAP cover?
There are no details in the policy document about how they actually go about calculating the cost of a new vehicle. The only thing I can see is from a claim document they sent me yesterday which is that I need to provide my original invoice so they can "request a quote from the dealership you bought the car from".

Does this mean they get a quote for the list price of a new vehicle. That's around £21,000 - so should I expect a payment of £6,000 to cover the difference?

Or do you think they will get a quote like a customer would, minus any dealership offers, which would probably peg the car at around £17,000? In which case would I get a payment of £2,000?

The problem in my eyes of the second scenario is that offers change and one month they might have deep discounts on this particular model of vehicle, and the next the price increases and I'm left out of pocket when buying a new car.

Does anyone think they can shed any light on this?

daveyjp

You state cost for a like for like replacement, if its £21k and the dealer is offering a discount the replacement cost is the discounted price.

Depending on the attitude of the insurer and Gap company it can take months to sort out the final figures, in the meantime you have no car.

ewen1605

Great responses, thank you.

The value of £15,000 is based on the Glass's Guide market valuation. My car insurance (Bell) initially valued the vehicle at £14,200 but my GAP insurer (Premia Solutions, purchased through the dealership) sent the Glass's value to me at £15,000 and told me to use this to make sure I got the right settlement from Bell.

Bell have now increased the value of the settlement to £15,000 to match the Glass's Guide value.

When I spoke to Premia Solutions they advised they would pay any GAP settlement by cheque or BACS, or if I wanted it, as a credit note to a dealership.

I'll upload the policy wordings tonight for you

Thanks again

ewen1605

lostinheaven wrote: »

Where did you buy your policy from and can we see the policy wordings? By seeing them we'll be able to give you far more accurate advice as opposed to putting forward hypothetical scenarios.

Here is the policy wording from Premia Solutions.
docdro.id/U6tcEHe

Thanks for looking and any further advice you have

BJV

Ok well gap insurance is like any other insurance in that you can not benefit from making a claim.

I would think however that like other posts said it would be the physical price you would have to pay so it would not include any national or manufacture deals. e.g if there is a £1000 discount nationwide. etc. You would be paid the price after discounts.

ewen1605

lostinheaven wrote: »

Can you confirm... you bought the car brand new?

How old is the car now?

Thank you so much for reading through th policy wording. I'm glad I wasn't the only one who couldn't see anything to reference how they calculate the cost of this replacement vehicle.

The car is about 17 months old (purchased January 2016) so there was no vehicle replacement offered by Bell when I made the claim.

Once I have proof of payment from Bell, then Premia Solutions will start to get their quote ready. Like you said, I think it's worth preparing to fight them on their own policy wording to see if I can get them to pay out the list price of an equivalent like for like vehicle.

Where I think they might get me is where they mention a pre registered vehicle. Again they could be really unfair and find an equivalent pre reg of the same spec and try and pay out based on that cars value.

ewen1605

I went to my dealership today and they were under the impression they would probably be phoned for a quote.

The more the money the better, I suppose. I will have to make sure that it includes all the factory-fitted accessories that my car had.

Because it was a special edition model that they no longer produce, I had black detailing and black alloys (£900 accessory) and front parking sensors that are no longer standard (£400 optional extra) so these are my ammunition to squeeze as much money out of them as possible.

I'll update and let you know how it goes once they get back to me with a quote.

ewen1605

Hello. Just thought I'd post a final update for this thread so that if someone finds it in the future and has the same question, they know what the outcome was.

The process that my GAP insurer went through was as follows:

First, they e-mailed a request for a quote to the same dealership that the car was originally purchased from. They sent them the invoice for the insured vehicle and asked them to create a new quotation based on that.

The dealership sent this quote back to the insurer who calculated the difference between the payout received by my car insurance and the new quotation price (+ up to £250 excess cover).

They calculated the difference to be approximately £1,700 based on a vehicle selling price of £16,500. Out of interest, I asked the insurer for a copy of the quotation received by the dealership. The quotation shows that the dealership did take off about £3,000 in "offers" from the vehicle so this answers the first question: the GAP insurer uses the dealership/offer price when calculating the payout and not the list price of the car.

In my particular case, I noticed that the while the factory fitted options such as metallic paint and space saver spare wheel, were included on both the original and new quotations, the other optional accessories that my particular car had were not.

This is because the particular trim level of my car, a SEAT Leon FR Black. is no longer produced. As a result the new quote was based on the closest equivalent, the regular FR. As mentioned earlier in the post, I felt like this meant I was not getting a true like-for-like replacement. While I appreciate that some parts will no longer be available, most of the options my original car had are still available from SEAT.

I contacted the GAP insurer with the following message:

Further to my telephone call earlier today, I would like to contest that I do not believe the quote obtained from JCT600 for a replacement vehicle accurately reflects the specification of the insured vehicle.

From the policy document, section 11(d):
'"Replacement vehicle" means a replacement new or pre-registered vehicle of the same make, model and derivative as the insured vehicle, including all factory fitted accessories'

The insured vehicle, as shown on the original invoice and order form, is a Seat Leon Hatch 1.4 TSI 125 FR Black Technology. The 'FR Black' trim level was at the time of purchase a special edition vehicle that included additional factory fitted accessories that are not included on the current range of Leon models, but are still available as optional extras.

I then provided a list of accessories fitted to the insured vehicle that were not present in the quotation for the replacement, including:

• Black vinyl roof
• Black mirror caps
• 18" black alloy wheels
• Front and rear parking sensors

And the response from the GAP insurer was promising - they said they would get another quote from the dealership:

I have asked [name] at [dealer] to revisit the quote in line with the features/fittings that were on the original vehicle but need to be separately itemised etc and provide a revised quote. Once I receive this I will ask the underwriters to revisit the claim.

I calculated the individual selling price of the accessories to be approximately £1400 so anything close to that value would have been welcomed.

To my surprise, I was contacted the following day with an updated figure that meant I would receive an additional £2000 on top of the original figure of £1700 for a £3700 total - so no complaints from me at all.

I have not asked for a copy of the second quote received by the GAP insurer because I'm happy that it now reflects the true specification of the insured vehicle.

Clearly my experience may differ to someone else's in the future depending on the wording of the policy, but I think that quoting a line of their own policy back to them with regard to the replacement including factory-fitted accessories was a big help in getting them to look at the payout amount.

Thanks to everyone's help who responded to this originally. :T

ewen1605

I'm replacing with another Leon and using some of the payout to cover the deposit - my insurance can be paid for outright this year too, instead of monthly!

I did originally buy this GAP policy from the dealer but like you said I've started looking at other providers online who might offer a cheaper price - just reading into the terms and conditions where I can find the policy documents