GAP insurance sales nonsense

neilmcl

The thing is, basically the FCA have told Car dealers that if you're going to also sell financial products, such as GAP insurance, you're now under a legal duty to give your customers full disclosure of all the relevant facts from the outset, which is no bad thing. This, however has led some dealers, whether by ignorance or not, to believe they have a legal duty to tell you about their products whether you want them or not, and if not to cover themselves to make sure they've at least given you the relevant information.

I agree with the above, the customer is more than free to state they're not interested and I don't see it as a big deal for them to sign to say so.

BJV

Personally I think Gap Insurance is just like any other insurance. I do have gap on my car as I could not afford to buy another or be left paying for something I don't have any more. I have always had it.

I have two cats and a dog but don't have pet insurance.

I have home insurance and life insurance. But don't have mobile phone insurance. It is about risk and if you want to take it or pay and let someone else take it for you. For me for the sake of a couple of pounds I would rather not bother worrying about what would happen if something happened and i did not have it.

The dealership should have just been more open and then left you to it. I am sure any reasonable person would not have a problem signing if they knew that really all they where doing is to take away the possibility of accusing them of not offering it. The four day window is to encourage you to shop around and make informed choices.

BJV

CB1878 wrote: »

Sadly we live in a society where some individuals are quite happy to sue anybody at the drop of a hat. I know for a fact that dealers have been pursued by customers when they have not been offered Gap Insurance (and the dealer was able to sell it to them) and then suffered financially when the vehicle was subseqently written off.

Not every customer is as honest and trustworthy as you are.

Where there is blame???? ha ha.

God we are turning into America where litigation follows everything.

Penelopa.Pitstop

I had it with Mercedes last year (cash purchase) and with Audi on Saturday (lease - PCH). Mercedes guy did it on tablet and I just signed that I'm not interested.

Audi guy wanted his business manager to do this but he was busy so did it himself. They had pre-clicked, printed forms and I signed that I'm not interested. Forms included: Asset Protector (gap), Smart Insurance (minor damages), Alloy Wheels Insurance, Tyre Insurance.

Judging by the posts on this forum and others, some people buy these additional products and are even happy with them. Definitely read comments about Alloy Wheels insurance being good product for some.

Audi price for Gap was £499, I bought finance gap for £122 for 3 years even before car collection. 2 years ago, Audi dealer sent me by accident internal documents and for selling £499 policy, salesman was getting £280 commission. Actually, 2 years ago Audi dealer sent me all these forms by email and asked to sign if I'm not interested. That's how I got internal documents by accident. So it's not a new practice.

I have no problem signing that I refuse, why make salesman life difficult for no reason.

Another thing is pushing paint protection. Mercedes pushed it at me for around £500, I said I'm not interested so I was told I will get it for free anyway. I spent the weekend cleaning the car because it was applied on 2 years old dirt. Then I found documents that it was applied when car was new as well, the same dealership.

With Audi, it was already on the invoice with discounted price for the whole car, no one even asked me if I wanted it. Dealership applied discount but squeezed it in as well to make some commission. I didn't protest, because I didn't really care. VWFS paid for most of it anyway and I knew what's my lease price upfront, however they came to it.

IamNotAllowedToUseMyName

AnotherJoe wrote: »

Presumably the same applies to the fire insurance you buy for your house?
The fact you haven't had to claim on it says nothing about its value.

No, it is different. I insure my house as I could not afford to rebuild it. I wouldn't get GAP insurance because:
a) The value for money is very low (not sure off the top of my head, but the ratio for home insurance is say £100 for £100k of cover) but the GAP is something like £100 for £3k of cover.

b) If I did have a write off, I could afford the difference to get me back on the road (assuming I was buying like for like) with the insurance payout.

So both rare events, but the value covered is so high on the house that it is worth it at the price.

AnotherJoe

IanMSpencer wrote: »

No, it is different. I insure my house as I could not afford to rebuild it. I wouldn't get GAP insurance because:
a) The value for money is very low (not sure off the top of my head, but the ratio for home insurance is say £100 for £100k of cover) but the GAP is something like £100 for £3k of cover.

b) If I did have a write off, I could afford the difference to get me back on the road (assuming I was buying like for like) with the insurance payout.

So both rare events, but the value covered is so high on the house that it is worth it at the price.

You've missed the point. As you'll see if you read again,My point was, someone (was that you ? ) said it was of no value because they hadn't had to claim on it. WHich is obviously ridiculous. It may indeed be of poor value but that's a different point entirely.

bris

jimjames wrote: »

But if you'd sold the car after 4 years you'd still only get back the value at that time? I weigh up the risk vs cost to decide if insurance is worthwhile

I think your missing the point of GAP insurance. It has nothing to do with accident free ownership, it covers insurance loss shortfall.


Believe me there will the thousands of people every year who now kick themselves for not taking out that GAP insurance they berated the poor salesman for trying to sell them it.


It also seems to me there is some confusion over what gap insurance covers.


When you take out finance on a new car for say 25k then 6 months later you write it off, well that car is now in massive negative equity. So the insurers offer 17k for the car but you still have 23k left on the finance the GAP insurance covers the 6k shortfall as in GAP.


I have never seen GAP insurance offer new for old 2.5 years down the line that is just wishful thinking. If this was the case there would be thousands of 2 year old cars in flames every year

dacouch

bris wrote: »

I have never seen GAP insurance offer new for old 2.5 years down the line that is just wishful thinking. If this was the case there would be thousands of 2 year old cars in flames every year

Google VRI or RVI gao

IamNotAllowedToUseMyName

AnotherJoe wrote: »

You've missed the point. As you'll see if you read again,My point was, someone (was that you ? ) said it was of no value because they hadn't had to claim on it. WHich is obviously ridiculous. It may indeed be of poor value but that's a different point entirely.

The point I was making (though I see why you read it that way) was underlining the rarity of a write off.

Same as all the white goods repair policies really. They are such poor value, often costing 25% of the good for often 3 years actual cover, that compared with the likelihood of claiming you have to be in a very poor financial position to need to spend so much because you could not afford a repair - and of course setting aside the cost of the policies would provide the self-insurance.

Put it this way, the insurers are profiting on these policies and that applies at the cheapest.

Interesting to compare to the car hire excess insurance policies which give a year's cover for about £35. You've got a pretty high chance of putting a dent in a hire car in Spain (very narrow village streets) and the amount they risk paying out is similar and they cover multiple hires..

IamNotAllowedToUseMyName

bris wrote: »

I think your missing the point of GAP insurance. It has nothing to do with accident free ownership, it covers insurance loss shortfall.


Believe me there will the thousands of people every year who now kick themselves for not taking out that GAP insurance they berated the poor salesman for trying to sell them it.


It also seems to me there is some confusion over what gap insurance covers.


When you take out finance on a new car for say 25k then 6 months later you write it off, well that car is now in massive negative equity. So the insurers offer 17k for the car but you still have 23k left on the finance the GAP insurance covers the 6k shortfall as in GAP.


I have never seen GAP insurance offer new for old 2.5 years down the line that is just wishful thinking. If this was the case there would be thousands of 2 year old cars in flames every year

But the 6 month example doesn't quite make the point as it is likely that you will have new for old, it is the 12-24 month gap which is the worst point in the loan for risk. It strikes me that it is not up to the original insurers to cover a system of purchase that leaves the buyer exposed though you'd think that they'd be interested in it as an add on like legal and breakdown cover.

If it wasn't for the finance being secured on the original vehicle you are still not really worse off. If you could transfer the PCP loan to the replacement car (like for like) then your original insurance would replace what you had lost. If you had taken out a bank loan rather than PCP there would not be a gap to insure, you'd be paying the loan and have a similar car to drive..