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Mind the GAP
12 March 2017
Protect your vehicle purchase with GAP insurance
For many people, their new car is their pride and joy. Unfortunately, as soon as that car is driven off the garage forecourt, it depreciates in value by as much as 10 – 15%. GAP insurance protects your investment and gives you peace of mind should the worst happen.
What is GAP insurance and how it works?
GAP stands for "Guaranteed Asset Protection". Most fully comprehensive car insurance policies only offer 'new car replacement' during the first 12 months of ownership. If your car is written off or stolen after this period your insurance will pay you the current market value of the car, but not the total amount of what you owe the finance company. This leaves a gap in your coverage being the amount that you still have to pay.
GAP insurance is especially important when leasing or financing a car since you often owe more than the value of the vehicle at that moment in time. If you paid for your vehicle in full, the GAP insurance product holds this value, as the pay out from the car insurance would only provide enough for a second hand car. The cover can also be taken out for brand new and second-hand cars.
There are a number of different types of GAP insurance and it's important to choose the product suitable for your needs. But the basic idea of GAP insurance is the same.
A Mercedes dealership quoted £525.00 for a £32,000 Mercedes. Our price is £231.95 – nearly £300 saving!
£25,000 VW Golf, purchased outright, 3 year GAP policy from £196.74
£30,000 BMW 320, lease agreement, 5 year GAP policy from £149.65
Where to get it from?
Sutton Winson of course! Car dealers traditionally sell GAP insurance but the place you buy your car from doesn't always have the best deals and you should never be pressurised to purchase it there. GAP cover is an optional extension, not a compulsory part of the deal. Before you commit yourself to an expensive policy sold by commission-driven salesmen, it might be worthwhile speaking to Sutton Winson. Here's why:
- Our GAP cover is available often at less than half the price of garage-sold policies.
- We have a flexible cancellation policy. Typically garages don't allow any refund when a policy is cancelled. If you change your vehicle prior to expiry of your policy, we will cancel it and allow a pro-rata refund subject to a small fee of £15 charged by the insurer, not Sutton Winson. If you are buying a brand new car, we can transfer the refund onto your brand new GAP policy. Full cancellation beyond the 14 days cooling off period, when you decide not to replace your vehicle, is subject to a £30 fee charged by Insurer but the reminder of the money goes straight back to you.
- Our staff will guide you to the most suitable cover depending on your circumstances and if you need to make a claim, it will be dealt by a UK based claims team.
So when initiating a car loan, lease or outright purchase, speak to us about GAP insurance. We are on 0208 891 4013 or email: email@example.com
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