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GAP Insurance - Worth it or not?

Quickstop

Active member
Joined
6 Feb 2009
Messages
25
Hi Guys

Posted the other day re new Carrera S arriving soon. Have been contacted by the dealership ( UK) asking me if I want GAP ( guaranteed asset protection) cover for the car for £600 which covers three year's finance.

The car lists at £100k and the guaranteed residual is £45k after three years.

I've tried to track the approx depreciation curve of these cars using used examples that are for sale and the depreciation all seems quite linear so I'm not sure if the Insurance is actually required.

Anyone else taken this cover based on a reasoned calculation?

Cheers
 
Depends if you are literally planning on writing it off (and check your T&Cs, but only a full write off triggers the payment of the DIFFERENCE between your statutory insurer's market price settlement vs your outstanding finance or the original invoice price - the latter being MUCH more expensive to insure)

If you do want it, NEVER buy from the dealer (unless they can match independent GAP quote - which they won't, as theirs has their cut too!)

If you were the sort of person to but Dixon's Extended Camera Warranty, have a Google, or try here for starters:

http://www.gocompare.com/car-insurance/gap-insurance/


Having worked in the trade, thanks for the quarterly bonuses and that yachting day I won for most sales :thumb:

PS - if the finance is balance loaded (not front loaded) and correctly matched (or exceeding) the market value loss, their is no way fiannce GAP will ever be in a positon to pay out, unless based on return to invoice price.
 
Also, if you take an Insurance policy which pays out agreed value, then you dont need to take up a GAP Insurance policy.
in my case, there was no increase in premium when i took an agreed value policy(rather than a market value policy) compared to a regular one on the comparison websites and hence i did not take up a gap Insurance policy.
 
Edited above to add PS

As GFV (balloon) is conventionally deliberately low, your monthly payments are therefore deliberately high - ie designed so that capital repayment exceeds monthly depreciation

ie your finance settlement < market value (which is insured by your normal insurer)
 
My dealer quote was £600 too but I purchased my Gap independently from GapInsurance123. Cost was £192 for a four year policy, the duration for which I'll likely keep the car.

This is an RTI (return to invoice) which will cover the difference from any Insurance payout to the amount that I paid for the car to a maximum 25k.

I did a bit of research and these guys came out well. They say they will payout within a week of your Insurance payout too.

Edit: Typo corrected
 
Just had this situation with one of my company cars, the employee crashed it avoiding a deer , the insurer wrote it off and agreed to pay a market value for a 16 month old rav4.
The finance company wanted an early settlement figure that was £7000 more than the Insurance settlement. This I was informed would have been covered by gap Insurance.
Ironical we were taking another full term finance deal on the replacement rav4 with the same company so effectively they were getting an extra finance deal after pointing this out to them they have agreed a settlement that is more acceptable to me but if we had been changing to another car make we would have been saddled with the full shortfall .
So if you can get gap cover for 4 years for under £200 as Nigel pointed out then it's a no brainer.
But as with all these things clearly a better cheaper product is available away from the main stealers. so tell them where to stick their over priced product (It really gets me that after spending up of 70k they still try and rip you off for a few quid with an over priced product.)
Try showing them an alternative cheaper quote and tell them they need to match it or you will feel they don't have your interests at heart. they always have a big margin in these type of things and things like alloy protection etc etc. :thumb: :grin:
 
If going for a 4-year period, gap coverage of more than £25K will be needed if you want RTI on a new 991. Not so many companies do above £25K.

Got a £50K max 4-year RTI on a £100K car with Shortfall (Aequitas Automotive Ltd) for £339. Felt that this was reasonable due to the £50K gap limit.
 
^^^ That's a good point. I just checked and there is an invoice limit of £75k with gapinsurance123. Interestingly they do point you to their sister sites for which shortfall is one.

"If your vehicle's invoice price is more than £75,000 why not try our sister website easygap.co.uk. Or for vehicles up to £150,000 why not shortfall.co.uk where you can arrange instant cover."
 
nigel99 said:
^^^ That's a good point. I just checked and there is an invoice limit of £75k with gapinsurance123. Interestingly they do point you to their sister sites for which shortfall is one.

"If your vehicle's invoice price is more than £75,000 why not try our sister website easygap.co.uk. Or for vehicles up to £150,000 why not shortfall.co.uk where you can arrange instant cover."

Worth looking at Shortfall because of these higher limits for either RTI Gap or Finance Gap.
 
I've always purchased RTI from ala.co.uk
 
I have bought GAP but not from the dealers. I think it is a no brainer if it is RTI as it covers depreciation too which no normal Insurance will do. Obviously it pays out only when it written off. With the price of repairs these days, it is so easy for the repairs to cost more than the car.

The point to remember is it only pays out the difference between the insurer and the invoice value so that depends on how much the insurer screws you on the payout. :lol:
 

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