Buy Contract Hire GAP insurance Today

Cover the remaining balance of your lease in the event of write-off

Get A Quote Here

Please complete the details below to get a GAP insurance quotation:

What is Contract Hire GAP insurance?

If your vehicle is the subject of a Contract Hire / Lease agreement and is declared a Total Loss (written off) through accident, fire, theft or flood your Motor Insurer will pay out only what they think your vehicle is worth at the time of claim.

In the meantime your finance company will have calculated their settlement figure which, would normally be a combination of some or all of the following:

  • The amount that the finance company think your vehicle was worth at the time of loss
  • The sum of anything up to 100% of the as yet unpaid rentals under your Contract Hire agreement at the time of loss.
  • Administration & or penalty fees for wrapping up the agreement early.

Your Motor Insurance payout might well fall short of this figure. If it does your finance company might hold you liable for anything up to 100% of the shortfall and this where Contract Hire GAP insurance steps in... to pay the difference between your Motor Insurance payout and the amount required to settle the remaining balance of your Contract Hire agreement.

In addition, for a small additional premium, you can also choose to cover up to £3,000 of the initial rental you paid as part of your Contract Hire agreement, meaning that you'd be reimbursed some or all of your initial rental for you to use against the cost of setting up a new Contract Hire agreement on a replacement vehicle.

Am I eligible for Contract Hire GAP insurance?

You can buy Contract Hire GAP insurance to cover a New or Used vehicle that:

  • Is less than five (5) years old.
  • You took ownership/delivery of within the last 365 days (or have not yet taken delivery of).
  • You purchased (or are purchasing) from a Motor Dealer or, Private Seller.
  • Is used for social, domestic, pleasure, commuting and some business uses (see below)
  • Has a P11d value of less than £150,001
  • Is the subject of a Contract / Lease Hire Agreement

You can NOT buy Contract Hire GAP insurance for a vehicle that:

  • Is more than five (5) years old.
  • You took ownership/delivery of more than 365 days ago.
  • Has a P11d value of more than £150,000
  • Is used for/in any sort of competitions or rallies, hire and/or reward, driving tuition, racing, pace making, speed testing or reliability trials, or as a taxi.
  • Is not listed in Glass’s Guide,
  • Is a kit car, or invalid carriage
  • Is used solely for delivery or courier purposes
  • Is a commercial vehicle of more than 3500kg gross weight.
  • Is an American, Australian or Canadian vehicle (unless built for the UK market)
  • Is NOT the subject of a Contract / Lease Hire Agreement

Key Features of Contract Hire GAP Insurance

  • Aims to pay the difference between Motor Insurance payout and the amount required to settle the outstanding balance of your Contract Hire Agreement.
  • NO right to reduce the GAP Insurance payout if your Motor Insurance policy pays out less than the Market Value of your vehicle at the time of loss.
  • Change your vehicle early and we'll cancel the policy and invoke a daily pro-rata rebate of unused premium (a cancellation fee may apply)
  • Available for Cars, Light Vans & some Motorhomes, up to 5 years old, that you took delivery of within the last 365 days.
  • OPTION to include cover for up to £3,000 of the Initial Rental that you paid at the start of your lease.
  • Underwritten by UK General Insurance Limited, on behalf of Great Lakes Insurance SE.
  • Pays up to £250 towards the excess on your Comprehensive Motor Insurance policy.
  • FREE transfer of any unused premium on to a new policy on a replacement vehicle
  • Policy durations of up to 5 years available.
  • Claim Limits of up to £100,000 available.
  • FREE policy amendments.

What Claim Limit Do I Need?

Choosing a suitable minimum Claim Limit for a Contract Hire GAP insurance policy requires a little calculation. In short, you need to know the total amount of rentals that you are (at the time of purchasing the GAP insurance policy) yet to pay under the Contract Hire Agreement. Thus, we'd follow this process:

  • How much is the initial rental payable? (Let's say this is £900)
  • How much are your normal monthly rentals and how many do you have to pay? (Let's say these are £300 per month and that you'll be paying 35 of them)
  • £900 + (£300 x 35) = £11,400.

In the above example, we'd determine that assuming you'd be liable for 100% of any potential shortfall between the Motor Insurance payout and the settlement figure of your Contract Hire agreeent, you'd need to be looking for a GAP insurance policy with a minimum Claim Limit of £11,400. In our case that means you should consider a policy with at least a £12,500 Claim Limit because the next level down is £10,000 and would be lower than the £11,400 calculated above.

To sum up, tot-up the total value of all rentals due under your Contract Hire Agreement, deduct from that figure the sum of any/all rentals that you've already paid. We then recommend that you choose a GAP insurance policy claim limit of no less than that resulting figure.

If you need any help with this, please do get in touch.