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Gap Insurance - Do you have a policy?


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It something I really wanted but due to problems with my car I didn't get it as the only drawback with it is, it only covers the car that you purchase so if for any reason (risk minimal) the car has to be replaced due to a serious mechanical fault you can not transfer the policy to the new car.
You are correct that GAP Insurance policies are not transferrable however in the circumstances that you describe (the dealer replacing the vehicle due to a manufacturing defect) the policyholder would be able to either transfer the remaining term of the policy to the new car or, if there was a price difference (increase) between the two vehicles, receive a pro-rata refund to use against the cost of purchasing a new policy for the replacement vehicle.

Of course, I'm talking about our policies and our procedures, but if the vehicle is being replaced due to a manufacturing defect, blame can hardly be attributed to the owner of the vehicle (the GAP Insurance Policyholder) and any Insurance company telling you otherwise is walking a very thin line as far as the FSA (Financial Services Authority) and their TCF (Treating Customers Fairly) Initiative would be concerned.


To clarify, if you decide to sell or transfer ownership of a vehicle covered by a GAP Insurance policy, then you're going to forfeit any remaining term of the policy and receive no form of refund.

On the other hand, if you purchase a vehicle from a dealer, take out GAP Insurance (from the dealer or a third party like ourselves) and the vehicle subsequently turns out to be defective. If the supplying dealer is accepting responsibility and replacing the vehicle (I guess this would effectively be under the Sale of Goods Act) then I can't think of any justifiable reason for any Insurance company to refuse to at least transfer the remaining term of the policy or not issue a pro-rata refund.
 

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Get an online quote then go back to the stealer........mine matched it!
 

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I've never been a great believer in optional insurance of any sort and must have saved thousands of pounds on policies I would never have claimed on. (That's tempting providence!) I garage my car every night and do only 4,000 miles a year, so the risk of a total write -off is reduced. During the sales negotiations the salesman offered GAP and again just before handover, when he said he could probably cut the premium to £250; only when I said no again did he conceded that my existing policy might offer something similar
 

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I'd been skeptical recently; but seen it's worth by a mate having his car nicked. The car was just over 12 months old and if he hadn't of had GAP insurance he would have been left with a 4K shortfall between that the insurance paid out and what he paid for it.

Beware though; Most GAP insurers will only pay out the "Glasses guide price" for the car; so they advise speaking with them before you accept any offer from your insurer. Matey didn't and lost out by about £300, but they way he looks at it is £300 is a better loss than £4K...
 

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For me it was just piece of mind.

I thought a £200 investment to fully protect my £17K investment was a no-brainer.

Everyone to their own tho !

Steve
 

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For me it was just piece of mind.

I thought a £200 investment to fully protect my £17K investment was a no-brainer.
I totally agree; what price peace of mind? The only way you can absolutely guarantee that nothing will ever happen to damage your car is if you pop it straight in the garage and don't ever take it out. And what's the point or fun in that?

I got all the insurances going and paid the up front 3 yrs servicing, just so's I know there'll be no nasty surprises, whatever happens.

I too am normally a bit skeptical about extra warranties, but with a brand new car, especially when you take depreciation rates for the first years into account, as Steve says, in this case it was a no brainer.
 

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Just wanted to check I was reading this correctly as the price seems fantastic.

Term: 3 years Claim Limit: £10000
Total Premium: £131 (inc ipt)

That's £131 for the whole 3 year premium (and not £131 per year?), based on car value 19275 and £10000 claim limit, seems like a steal to me !
 

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Unless it gets written off in the first year. Then you're £10k down ... I'd rather pay a larger premium and insure the full amount.
 

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Unless it gets written off in the first year. Then you're £10k down ... I'd rather pay a larger premium and insure the full amount.
Katsock, I think there may be some crossed wires on your part.

If the original price of the vehicle was £19,275 and he has a claim limit of £10,000 as part of an "Invoice GAP Insurance" policy, then the motor insurance company could offer him £9,275 and subject to the terms, conditions and exclusions of the GAP policy, he'd still get back to the original £19,275 purchase price.

He'd only be "down" in the context that you mean, if his motor insurance company offered him less than £9,275 (thereby making the difference (aka "GAP") greater than £10,000).

For example, if his motor insurance company offered him £7,000 for the vehicle then the Invoice GAP Insurance policy with a £10k claim limit would max out at £17K (combined with the £7k motor insurance payout) - therefore he'd be "down" only £2,275.

For him to be £10k "down" at any point, his motor insurance company would "offer" him -£725 for the vehicle... e.g:

  • Motor insurer "offers": -£725
  • We pay: £10,000
  • Customer therefore in receipt of: £9,275
  • Difference to original purchase price of £19,275 = £10,000
This would never happen ;)


Incidentally, Yokozuna: I'm told that WhatCar are currently reporting the average vehicle as depreciating by between 44% and 77% over a period of three years... there's a whole host of contributary factors that can affect this but on numbers alone, based on an original value of £19,275:

  • 44% = £8,481 (E.g. a £10k claim limit would be enough)
  • 77% = £14,841.75 (E.g. you would need a claim limit of £15k)
Of course, nobody actually knows exactly how much your car is going to depreciate by but looking at those figures I'd suggest you go for at least £12,500 as the claim limit - if not more.

You can get quotes on our website and just like Click4Gap (the supplier you got your existing quote from) we're also affiliates of CivInfo (make sure you go through our official link on the forum) AND we have a price promise to beat any lower price offered by a competitor.

If you want to know anything else about GAP Insurance either ask here, PM me or contact me directly in the office.

Regards

David
 

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David, my apologies, you are of course correct and I am, of course thoroughly :oops:

What I meant was - that I'd rather pay a slightly higher premium and know that my GAP insurance would pay the full gap, regardless of the depreciation on my car.
 

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David, my apologies, you are of course correct and I am, of course thoroughly :oops:

What I meant was - that I'd rather pay a slightly higher premium and know that my GAP insurance would pay the full gap, regardless of the depreciation on my car.
Yeah I figured that's what you meant! It is possible to select a claim limit totalling most (if not all) of the original purchase price if you so wish. In almost all cases the policy would still be cheaper (sometimes considerably so) than the rates quoted by the motor dealer too!

Ultimately it's a matter of personal preference but it seems plenty of people would rather be over-insured than under-insured.

Regards

David
 

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we 1st took out gap on our 1st civic 2.2 sport when we bought it back in august 2006 paid £15500 for the car and £395 for the gap from Honda. Back in jan this year the wife crashed the car after breakin on ice and crashing into a lamp post it was a write off over 8k of damage. After arguing with the insurance company we settled on a figure of £8,900 just out of luck we remembered that we took out gap and that it was still covered we put in a claim and they eventually paid out with a cheque of £6,600.

Claiming was easy but they really dragged their feet with sending the payment - we put the claim in at start of feb and had the cheque on 15th April! everythin was above board with the car and insurance and that so it was no problems due to us we were jus lucky that we had the money to buy the car we wanted before the gap cheque came thru otherewise we would have had to get a loan or finance. All in all i would definitly recommend gap we have now got a 57 plate 2.2 ex in mint condition and a good few £k left over in the bank for a holiday and some home improvements :p
 

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I personally don't think it's worth it... then again it depends on how many cars you'll think you'll own in your lifetime. You'd have to break a lot of mirrors to get bad enough luck to need GAP insurance each time you buy a car. Therefore if you save the money you'll potentially pay out in your lifetime on GAP insurance you'll prob have enough to cover what it would top up, plus the benefit that if you never have an incident you'll still have your cash.

Basically, it doesn't come down to opinion but getting the numbers to add up. How much will a new car loose over the time period, how much does the insurance cost and how many cars would you buy in a lifetime ?
 

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It's not necessarily how many cars you think you'll buy in your lifetime, more a case of how many cars you think you might have written off in your lifetime!

Personally, I've owned 5 cars in my life (discounting ones that my Mrs drives or company cars) and two of those have been written off by other people driving in to them. Even adding the two I've bought that my other half has used, that's still two written off out of 7 and when you're paying ten grand plus for a decent newish car, then I reckon it's worth protecting against a potential loss.

If I'd had GAP cover on all 7 of my cars, I'd still be in profit.
 

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Well worth the £17.50 a month charge! I would cry if I had an accident in the CTR and it was write off and got tuppence back off Churchill
 

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thinking more of these specialist companies rather than honda does this have to be taken out within a time limit of buying your new car, eg i've had mine 3 months
 

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Thanks EINino9 will be defo gettting it via quidco, the stealer offered it me at a special rate of " so he says"

£330 instead of £395.
He said I would have to pay £160 up front then 10 monthly installments of £17.

Click4Gap offered me over the phone £129 for 3 years "one of fee". So doing it through QuidCo I can get £22.50 back so would work out at £106.50
 

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