Gap Insurance Question

venomx

Purchased a used car about a month ago ( cash, up front ) and looking for GAP insurance.

On the MoneySupermarket website it asks if I want " Combined Return To Invoice "  " Return to invoice " or " Vehicle Replacement"

Which one is best suitable for me ?
All I want is to cover the gap in the event of a write-off or a stolen car to equal what I paid for my car

My insurance is fully comp

DullGreyGuy

If you want it to return to what you paid then that's Return to Invoice. 

99% (or more) of RtI and VR are written combined with Financial Gap and suspect that's what one bunch are trying to highlight with the "Combined" option, the others are probably including it but not saying. Obviously if you have paid cash then no need for the Financial Gap section but it simply wont respond if its cheaper to buy.a policy with it than without.

venomx

Thank you !
What exactly is the Vehicle Replacement option compared to Return to Invoice ? I have done some googling but find it confusing

I would assume they offer a like-for-like car rather than a cash pay out ?

DullGreyGuy

Vehicle Replacement covers the cost of a replacement vehicle.... so if you had bought a secondhand car pre Covid RTI say would have given you a total of £10,000 but because the price of vehicles shot up VR would have given you a total of say £12,000

Obviously it may now work the other way around if vehicle prices drop to more sensible numbers once the supply chain issues are resolved so that £10k for RtI may only be a £8k for VR if the prices have slumped. 

VR basically, in theory, ensures you can buy the replacement vehicle and protects you against movements in prices of cars. RTI gives you back what you paid which may too little, enough or too much to buy a replacement depending on how the market has moved.

venomx

DullGreyGuy said:

Vehicle Replacement covers the cost of a replacement vehicle.... so if you had bought a secondhand car pre Covid RTI say would have given you a total of £10,000 but because the price of vehicles shot up VR would have given you a total of say £12,000

Obviously it may now work the other way around if vehicle prices drop to more sensible numbers once the supply chain issues are resolved so that £10k for RtI may only be a £8k for VR if the prices have slumped. 

VR basically, in theory, ensures you can buy the replacement vehicle and protects you against movements in prices of cars. RTI gives you back what you paid which may too little, enough or too much to buy a replacement depending on how the market has moved.

Brilliant thanks.
The safest bet for me then would be to go Return To Invoice. As all I want is to cover the exact price of what I paid for my car. Is that right ?

venomx

Final question.
I did a part exchange with my old car. 
When I take out gap insurance, do I enter the value of the car before or after the part exchange ?

Dave_5150

venomx said:

Final question.
I did a part exchange with my old car. 
When I take out gap insurance, do I enter the value of the car before or after the part exchange ?

Price of the new car after any discount as shown on the invoice. Don't include you p/x as that is simply part of how you are paying for it.

MX5huggy

Before the PEx. You want the value of the car. Make sure you keep that invoice you’ll need in the unlikely event of you claiming on the policy. 

Definitely RTI policy, RV would be too complicated to get a equal car. 

venomx

Dave_5150 said:

venomx said:

Final question.
I did a part exchange with my old car. 
When I take out gap insurance, do I enter the value of the car before or after the part exchange ?

Price of the new car after any discount as shown on the invoice. Don't include you p/x as that is simply part of how you are paying for it.

Thanks. Yes I have proof of purchase etc so I will enter what it says on there.

DullGreyGuy

venomx said:

DullGreyGuy said:

Vehicle Replacement covers the cost of a replacement vehicle.... so if you had bought a secondhand car pre Covid RTI say would have given you a total of £10,000 but because the price of vehicles shot up VR would have given you a total of say £12,000

Obviously it may now work the other way around if vehicle prices drop to more sensible numbers once the supply chain issues are resolved so that £10k for RtI may only be a £8k for VR if the prices have slumped. 

VR basically, in theory, ensures you can buy the replacement vehicle and protects you against movements in prices of cars. RTI gives you back what you paid which may too little, enough or too much to buy a replacement depending on how the market has moved.

Brilliant thanks.
The safest bet for me then would be to go Return To Invoice. As all I want is to cover the exact price of what I paid for my car. Is that right ?

On paper the "safest" is VR because it protects you from price fluctuations. Many argue we are just off the top of the market so the safest may not be necessary.

If you want RTI then RTI is what to get, the market risk is both positive and negative in nature. 

As to the other Q... you quote the value excluding the PX

venomx

Thanks for all the useful information. All sorted