What Is Gap Insurance?
Gap Insurance as it is known, is there to protect you against the unseen potential costs of having your vehicle written off.
In the unfortunate event that your car is deemed a total loss, 'Gap Insurance' is designed to protect you against any financial shortfalls that may occur. If the financial settlement value that your insurer will pay out is less the outstanding rentals left on a contract hire agreement or the payments on a finance agreement the Gap Insurance will cover you for the shortfall. If the insurance settlement figure is less than the write down value of the vehicle then again, it will protect you against the financial shortfall. With the variety of insurances available in the marketplace you do need to clarify with your Gap Insurance provider exactly what cover you will receive.
What Type Of Vehicles Can I Insure With Gap Insurance?
Most road going vehicles can be covered by Gap Insurance. These include vehicles that you have financed on a purchase agreement and vehicles that you have leased on a lease agreement such as contract hire. You can take out a Gap Insurance policy to cover both new and nearly new vehicles. These include new and nearly new; cars, light commercial vehicles and motorbikes where purchased from a Vat registered dealer.
What Type Of Gap Insurance Cover You Are Taking Out.
Before you say "Yes" to a Gap Insurance policy make sure you understand the terms and restrictions that apply to the policy. Gap Insurance is easily missed at the time of ordering your new vehicle. It's definitely the type of policy that you could wish that you had taken out if the event of a vehicle 'write off' happens to you.
How Much Does Gap Insurance Cost?
How much will a vehicle write off cost you? It's bad enough that an accident occurs but if you are presented with a bill for your car as well it can really be a painful but avoidable experience. Gap Cover usually is available for a few hundred pounds as an upfront lump sum cost.
Who Should I Talk To About Taking Out Gap Insurance?
Talk to your vehicle supplier. If they are not registered by the Financial Services Authority to sell Gap Insurance, they can usually introduce you to a specialist who is licensed to advise you.