gap Insurance - any advice on reputable providers?

oscarward

Stateofart said:

Waste of money.  It's a big con.

Not from our experience when my wife’s car was stolen. Insurers + gap put her back to where she started less the years finance she had paid off. Got a better and younger car with the money. A relative has just had similar when his car was written off after an accident.

thisisthecount

oscarward said:

Stateofart said:

Waste of money.  It's a big con.

Not from our experience when my wife’s car was stolen. Insurers + gap put her back to where she started less the years finance she had paid off. Got a better and younger car with the money. A relative has just had similar when his car was written off after an accident.

can I ask who the provider was?

Stateofart

thisisthecount said:

Stateofart said:

Waste of money.  It's a big con.

oh really, so none of them are worth going for? 

There's a reason the insurance is being pulled, give it a quick Google.  It's a rip off and although it might work for the minority, the real reason for it's invention is to claw more money from something they should be doing anyway with normal insurance. 

Lavendyr

I've taken out gap insurance for £189 on a four year personal lease car. The cost of the lease over four years is around £18000 and we are a one car family so the idea of having to pay off the finance on a written off car was worth the surety of the gap insurance. I am aware that the first 12 months are covered by regular car insurance but did not want to risk us being in a poorer situation in the worst case. It was a small price to pay, and I'm sure that's how they get you.

thisisthecount

I wasn’t aware the first 12 months are covered by my car insurance? Really?

DullGreyGuy

thisisthecount said:

I wasn’t aware the first 12 months are covered by my car insurance? Really?

Yes and no... most Comp cover includes a new replacement vehicle in the first 12 months if you are the first registered keeper of the vehicle (ie its brand new not pre-reg or secondhand etc).

However, if the car is on finance the finance company have to agree to the switch of cars, ie resecure the finance on the new car. In many cases the finance company refuse at which point your insurer falls back to paying market value for the vehicle. 

thisisthecount

oh ok, wnhat about a Lease? is this different? 

Shedman

DullGreyGuy said:

thisisthecount said:

I wasn’t aware the first 12 months are covered by my car insurance? Really?

Yes and no... most Comp cover includes a new replacement vehicle in the first 12 months if you are the first registered keeper of the vehicle (ie its brand new not pre-reg or secondhand etc).

However, if the car is on finance the finance company have to agree to the switch of cars, ie resecure the finance on the new car. In many cases the finance company refuse at which point your insurer falls back to paying market value for the vehicle. 

How much of a risk of that happening is that especially with finance through a manufacturer's finance arm?

Presumably, if it were to happen, you could pay off the outstanding balance of the finance (esp if PCP/HP) and hence the car was yours and the insurance company provides you with a like for like replacement rather than requiring finance company agreement? Obviously that depends on you already having the money available to settle which I would have.  I've held off taking GAP insurance out for the first year based on insurance providing suitable replacement car, but as I have taken out PCP (purely as it actually works out better than paying it off straightaway due to interest rates on savings currently) you have raised some doubts in my mind as to whether I need to get the GAP now.

DullGreyGuy

Shedman said:

DullGreyGuy said:

thisisthecount said:

I wasn’t aware the first 12 months are covered by my car insurance? Really?

Yes and no... most Comp cover includes a new replacement vehicle in the first 12 months if you are the first registered keeper of the vehicle (ie its brand new not pre-reg or secondhand etc).

However, if the car is on finance the finance company have to agree to the switch of cars, ie resecure the finance on the new car. In many cases the finance company refuse at which point your insurer falls back to paying market value for the vehicle. 

How much of a risk of that happening is that especially with finance through a manufacturer's finance arm?

Presumably, if it were to happen, you could pay off the outstanding balance of the finance (esp if PCP/HP) and hence the car was yours and the insurance company provides you with a like for like replacement rather than requiring finance company agreement? Obviously that depends on you already having the money available to settle which I would have.  I've held off taking GAP insurance out for the first year based on insurance providing suitable replacement car, but as I have taken out PCP (purely as it actually works out better than paying it off straightaway due to interest rates on savings currently) you have raised some doubts in my mind as to whether I need to get the GAP now.

No, if the car is on finance the insurer is obliged to pay the finance company so you'd then need to pay any shortfall and finance a new car yourself. 

thisisthecount said:

oh ok, wnhat about a Lease? is this different? 

I was only ever in the technical team dealing with the third party, injuries etc not our policyholders. My understanding is they often prefer to collect cash than a vehicle. In fairness there may well be extra complexities with VAT for them (which is why lease companies won't sell you the car at the end of the agreement in most cases)

Grey_Critic

Sorry to rain on peoples parade

****GAP insurance is being suspended by the Financial Conduct Authority****

This from today’s Daily Telegraph

https://www.telegraph.co.uk/cars/advice/car-insurance-gap-cover-suspension/