New Post Advanced Search

Gap insurance on Used PCP

6 replies 81 views
Evening all, 
I'm just trying to get my head around gap insurance. I've had a look online but it seems most of the articles are geared towards new purchases. I'm looking to by an 'approved used' car on PCP and think I might need gap insurance to cover the cost of paying the finance should there be a deficit in the cars value if written off.

The car is £16490 and the term is over 4 years. 

Any advice would be great. 
Best wishes, 
Alex

Replies

  • Noggin500Noggin500 Forumite
    2 posts
    First Post
    Hi Alex
    You can get GAP on most secondhand cars up to about 8-10 years old. The older the car is, the less it'll depreciate, so the potential shortfall between the car insurance payout and what you might owe is going to be less. With a value of £16.5k it sounds as if there's still quite a bit of value left in it, so it's worth considering a return to invoice policy that would pay the difference between the market value and what you owe on the finance, or the £16.5k (whichever is higher). You can prob get a policy online for about £150-£175 for 4 years online. You could look at Gapinsurance.co.uk or maybe Ala as they've been around a long time but check their underwriting as quite a few overseas ones have gone bust.
  • raymonsellraymonsell Forumite
    3 posts
    First Post
    MoneySaving Newbie
    Hopefully this is a simple question.
    I have over the last 10 years purchased 3 cars from a well known dealer. On each occasion I have signed up for GAP insurance, and this has merely involved a box being ticked by the salesman. I have never been advised that there were different types of GAP insurance, and at no time did I receive a policy ( which I now know to be 16 pages long).
    In April this year I was involved in a RTC. I am a volunteer emergency response doctor  and I exercised a legal exemption to treat a red light as a give way, whilst using blue lights and siren, proceeding with caution. Another vehicle was in collision with my car, writing both off. my own insurance company were excellent, but it took months to make any progress with the GAP insurers. After numerous emails I have been advised that the policy will not be honoured, as I was responding as an emergency using blue lights and sirens ( I am fully trained and accredited to do so ) . 
    I have been told that it was "all in the small print" and the policy I was sold was inappropriate. The dealership knew that the car was to be used as an emergency response vehicle, as with my previous 2 cars ( I had sought sponsorship from the company to help fund the charity I respond for) .  They did not at any time during the purchase of all three cars talk through the policy or the exclusions.
    I should have received £4,800, but have been told I will receive nothing other than a refund for this latest policy.
    Can I seek refunds for all three mis-sold policies from the car dealer? Can I seek damages to cover the £4,800 shortfall ? Should the car dealership cover the £4,800?  I have clearly been mis-sold 3 policies.  My family have collectively bought 8 cars from this same outlet in the last 12 years or so. GAP insurance has been taken out on each as part of the PCP agreement. each time it has simply been a tick box, no paper work, no policy, no explanation. 
    I would be very grateful for your expert advice
  • SandtreeSandtree Forumite
    1.4K posts
    1,000 Posts Name Dropper
    ✭✭✭
    Would probably be sensible to start your own thread given you're asking a totally different question.

    The sale of insurance falls into two categories... advised and non-advised. Most personal general insurance falls into the second category where the sales person cannot at all advise you but should simply provide the facts of the product and it is up to you to determine if it meets your needs. For an advised sale the sales person can and should recommend products to you and will explain (and document) how their recommendation meets your demands and needs.

    A showroom sales person will certainly be a non-advised sale and so it was for you to check that it'd cover, though they can point out that you should really check, and so the real issue is that not policy documents were supplied. Having now received them I assume you agree there is an exclusion for emergency services? Were the previous policies with the same insurer, have they advised that this is a long standing term (ie would have been present in the prior policies)?

    You need to follow the complaints process in the policybook about the failure to provide documents... though technically as the cooling off period starts at the later of your purchase and provision of policy documents you are technically still in the cooling off to cancel the prior policies (though wouldn't try to argue this one personally).

    You will have little grounds to argue the claim should be covered despite the terms because of the fact its a non-advised sale
  • raymonsellraymonsell Forumite
    3 posts
    First Post
    MoneySaving Newbie
    Thank you for the advice. I'm new to this site, and now understand that I should have started a new thread. With regard to any possible appeal, is the fact that they never issued any policy documents for my perusal an issue I can question? As stated, we have as a family bought 8 cars from the same company, all with GAP insurance, and at no time were we ever advised that there was a policy document, we rather naively assumed that the "Tick Box" was all that was required, in that either we had or had not purchased insurance. The minutiae was never alluded to. I think they were just happy to take the money, along with the extras for the coating, mats, etc etc .
  • SandtreeSandtree Forumite
    1.4K posts
    1,000 Posts Name Dropper
    ✭✭✭
    Theyll be very happy... 12 years ago I worked for a bank who bought Gap insurance wholesale for £75, we then sold it to garages (plus our finance) for £150. The garage then sold it to customers for £300. We the bank did nothing other than leverage our relationships and that garages preferred to deal with one company.

    That aside, failure to provide policy docs is a notable issue.

    Next time, shop around... the wholesaler also used to sell direct to consumer for £125
  • raymonsellraymonsell Forumite
    3 posts
    First Post
    MoneySaving Newbie
    Brilliant ! Thank you for the prompt and expert advice.
Sign In or Register to comment.

Quick links

Essential Money | Who & Where are you? | Work & Benefits | Household and travel | Shopping & Freebies | About MSE | The MoneySavers Arms | Covid-19 & Coronavirus Support