A Guide to GAP Insurance
GAP insurance protects you financially if your vehicle is written off or stolen (also known as a TOTAL LOSS).
It’s not just about covering a financial shortfall. We have spent 20 years improving our products. Now they come with a host of extra benefits.
Remember! GAP insurance does not replace your normal Motor Insurance. You still need motor insurance. GAP insurance is an extra layer of protection to stop you from getting a nasty financial shock.
The right GAP insurance depends on how you paid for your vehicle.
Don’t worry about choosing. Our online quote wizard will ask you a few simple questions. Then, it will show you the products available.
Read about our products below:
Suitable for: People who buy their vehicle with cash, a bank loan, HP or PCP finance and want protection for more than 12 months.
Note: This product does not cover leased or contract hire vehicles.
What does it do: If your vehicle is declared a write off, this product pays the difference between the insurance payout and what you paid for the vehicle or the remaining finance balance, whichever is higher, up to a set limit. Here’s a summary of what’s included in your policy:
- Depreciation Protection: This cover pays the difference between the motor insurer’s payout and the original purchase price (* excludes certain items), or if greater;
- Shortfall Protection: If you owe more on your finance agreement than the motor insurer's payout, it covers the higher early settlement amount instead.
- Total Loss Excess Cover: If you paid an excess to your insurer after a write-off, it reimburses up to £500.
- Temporary Mobility: You will get a hire car for up to 30 days after a write-off.
- Additional Excess Cover: We pay you back up to £500 towards your excess for normal, everyday motor insurance claims that aren't related to a vehicle write off or glass/windscreen repair. So if your vehicle is damaged and you make a claim under your motor insurance policy to repair it and your motor insurer charges you £400 excess, your GAP policy will pay you £400. You can claim up to £500 per year for the duration of your GAP policy.
- Choice of cover period: You can choose how long you want the cover to last.
* The purchase price does NOT include the cost of accessories or items fitted after the Date of Purchase; and discounts and/or contribution, road fund license, delivery charges, number plates, new vehicle registration fee, administration fees, scrappage schemes, fuel, paintwork and/or upholstery protection kits and cherished number plate transfers; and insurance premiums, subscription charges or warranty charges; and Negative Equity, arrangement fees, arrears, interest on late payments; and any VAT, if You are VAT registered and able to reclaim the VAT element.
Suitable for: People of businesses who are leasing a vehicle.
What does it do: If your vehicle is written off or stolen, this policy protects you from being left with a potentially large, unexpected bill from your leasing company. Here’s a summary of what’s included in your policy:
Shortfall Protection Car insurers only pay the market value of the car on the day of the loss. This policy covers the financial gap between that insurance payout and the total amount you still owe to clear your contract hire or lease agreement.Suitable for:
- People who bought their vehicle privately (not from a dealer), or have owned their vehicle for more than 3 months and didn’t buy GAP insurance.
- Want an annual policy they can review and renew until their car is 10 years old.
If your vehicle is written off, this product increases the motor insurance payout by 25%, up to £10,000. It can be renewed and we will contact you before your period of cover ends. Please note this policy can't be transferred if you change your car, please contact us for assistance. .
What does it do:
- 25% valuation boost: It increases the motor insurer total loss payout by 25% to help you buy a new car
- Total Loss Excess Cover: If you paid an excess to your insurer after a write-off, it reimburses up to £500.
Click here for a real claim example
If your car is brand new and you are the first person to register it, your car insurance might include 'new for old' cover for the first year. This means they will try to replace your vehicle with a brand new one instead of giving you cash, following a total loss (write off).
It sounds reassuring but the reality is that this benefit is often subject to strict terms and conditions, and many drivers are surprised to discover they don't qualify when they need it most. That's why it's worth understanding how your motor insurance works before deciding whether you need GAP Insurance.
Do I still need GAP Insurance?
Only you can decide if GAP Insurance is right for you, but it's important to look beyond the 'new for old' promise from your motor insurer. Our GAP Insurance products provide valuable additional benefits, including:
- Reimbursement of your motor insurance excess if your vehicle is declared a total loss (up to the policy limit).
- Reimbursement of your motor insurance excess if you've had an excess to pay following any type of valid claim with your motor insurer (up to the policy limit).
- A temporary replacement hire vehicle to help keep you on the road. (not available on Total Loss Top up)
- The option to transfer your policy to a replacement vehicle of a similar value at no extra cost if your car is replaced (not available on Total Loss Top up).
Why 'New for Old' Doesn't Always Apply
We've spoken to many customers over the years who expected a brand-new replacement after a total loss, only to receive a cash settlement instead. Here are some of the most common reasons.
- You aren't the First Registered Keeper
Many insurers only offer a new replacement if you are the vehicle's first registered keeper.
This can catch people out. For example:
- If your vehicle is leased, the leasing company is usually the registered keeper, not you.
- Some dealerships register vehicles before they are sold, meaning you may not technically be the first registered keeper.
Even if you've bought a brand-new car, it's worth checking your policy wording.
- Your Vehicle Is on Finance
If your vehicle is financed, the finance company has a legal interest in the vehicle and may prefer a cash settlement rather than accepting a replacement vehicle.
In these circumstances, your insurer may settle the claim in cash, which could be significantly less than the amount you originally paid for the vehicle and be in a situation where you need GAP insurance.
- An Exact Replacement Isn't Available
If your insurer cannot source the same make, model and specification of vehicle within a reasonable period, they may offer a cash settlement instead of replacing your vehicle and you find yourself in a situation needing GAP insurance.
- You've Exceeded the Mileage Limit
Some insurers only provide new-for-old replacement if your vehicle has covered fewer than a specified number of miles during the first year.
If you've exceeded that limit, the benefit may no longer apply.
No two motor insurance policies are the same. The only way to know whether your insurer will replace your vehicle is to read your policy documents carefully and understand the conditions attached to the cover. If you're unsure whether GAP Insurance could provide additional protection for your circumstances, our team will be happy to help you understand your options. If you are unsure, contact us.
We are experts: We have focused on GAP insurance since 2001. We have been the official GAP insurance providers for the British Insurance Brokers Association since 2012.
We save you money: Some Car dealers sell GAP insurance at high prices. Because we sell online, our costs are lower, and we pass those savings to you.
We are safe: Our policies are backed by top ‘A’ rated UK-based insurers. We are fully regulated by the Financial Conduct Authority.
The right GAP product depends on how you bought your vehicle and when. Some products must be purchased soon after buying your vehicle. Always compare options to find the best coverage for your situation.
