There's a raft of things to consider when comparing GAP insurance from one provider to another. Is the most expensive always the best? Is the cheapest always the worst? Are there clauses which may not seem obvious at first, but might become considerable problems in the event of a claim or cause hassle in the event that you wish to cancel your policy or 'transfer' cover to a new vehicle?
We've listed below some of the features of our policies so that you might suitably compare them with others available on the market. It's plenty of reading, but spending the time to confirm that you have a decent policy now (even if that means paying a minor premium for it) could well make all the difference later.
We've split them up in to segments in order for you to get straight to the issues that interest/affect you.
This is quite simple really, there aren't many providers who, like us, can provide GAP Insurance online for vehicles purchased for up to £150k. In some cases where companies do offer cover for such high-end vehicles, the available Claim Limit options appear very low to the point that it looks woefully inadequate from the outset. Which is why we offer Claim Limits of up to £100k on such vehicles - Some would view this is as potentially overkill, but we take the view that at the time of any claim, it's clearly better to have had too much of a Claim Limit (which comfortably covers the "gap" that may have occurred) than too little of a Claim Limit (which would leave you (the policyholder and claimant) having to put your hand in your pocket further still).
To clarify, a GAP insurance "Claim Limit" refers to the most that the policy would be prepared to pay (in addition to that which you receive from your Motor Insurance policy) towards either the original vehicle invoice price (see: Invoice GAP insurance) or the cost of replacing the vehicle at the time of claim with one of the same make, model, specification, age and mileage as your original vehicle was when you first bought it (see: Replacement GAP insurance).
Going hand in hand with the ability to provide GAP Insurance for vehicles that were purchased for up to £150k, it stands to reason that the more expensive the vehicle, the greater the potential depreciation, therefore there's an inherent requirement for a greater/higher Claim Limit.
You see, the average vehicle (and we're not suggesting a vehicle bought for £150k is "average") is expected to depreciate by between 50% and 70% over a three year period, so in theory, a vehicle purchased for say, £125k would have a potential depreciation range of between £62,500 and £87,500.
However it seems not all GAP insurance providers are as prepared as us to assist you in protecting yourself against such a financial loss, because if you look at some of the policies offered by our competitors, they'll allow cover to be purchased for vehicles bought for up to £125k yet they still only offer maximum claim limits of £50,000.
We can not only provide GAP insurance for vehicles purchased for up to £150k but also provide Claim Limits of up to £100k too!
If you've had the supplying dealer fit any accessories/options to your vehicle (including fuel & Paintwork/Upholstery Protection Applications), you might be surprised to learn that the cost of those accessories/options may not actually be covered by a GAP insurance policy purchased from another provider.
Some policies entirely exclude cover for dealer-fitted accessories/options altogether. Some other policies entirely exclude cover for third-party accessories/options (E.g. those that are not genuine manufacturer accessories/options). Others apply a specific financial limit (usually £1500) to their cover for dealer-fitted accessories/options.
Our policies will cover the cost of all accessories/options fitted to the vehicle either by the factory or the supplying dealer (whether "genuine" manufacturer, or third-party). All that we ask is that when you're declaring the purchase price of the vehicle to us, you declare the purchase price inclusive of the costs for all accessories/options that were fitted to the vehicle. So for example, if you bought a vehicle for £10,000 plus £1,000 of dealer-fitted accessories/options, we ask that you input the purchase price of the vehicle as £11,000.
Note that our policies are unable to cover the cost of accessories/options, or modifications made/fitted to the vehicle AFTER you take delivery of it. However unlike some other policies out there, modifications made to your vehicle after delivery won't void the GAP insurance cover (so long as your Motor Insurance policy remains valid).
Historically, costs incurred for things like extended warranties, service plans and so on, at the time of buying a vehicle, were excluded from GAP Insurance cover, however, in recent years there have been steps to incorporate cover for such items.
Other policies either apply a lower financial limit to the amount of cover provided for these items (usually £1,500 - a limit that normally has to apply in total, for any and all costs that were for anything other than the vehicle itself) or still entirely exclude cover for these items altogether.
Our policies will cover such costs on a pro-rata non-recoverable basis. For example if, at the time of buying your car, you buy a 3yr Service Plan for say £300 and then your car is written off when you have exactly 1-year of that Service Plan remaining... if the Service Plan provider will not either refund you the remaining £100 or allow you to carry the balance (or duration) forward to a Service Plan on your next vehicle, our GAP insurance policy will cover the remaining (in this example) £100.
This is arguably the most important comparison point. Failing to comprehend what this actually means and buying a policy that has such a clause within it, could literally mean the difference of hundreds, perhaps even thousands of pounds at the time of claim.
If your car is declared a Total Loss (written off) as a result of accident, fire or theft, your Car Insurance policy provider will pay you what they believe the car to be worth at the time of that claim. If your GAP insurance policy has a Market Value clause in relation to the Car Insurance payout (E.g. if it says, "...will pay the difference between the Market Value of the vehicle at the time of loss and..." then seperately defines "Market Value" as a value given by one of the industry valuation guides (such as Glass' or CAP Guide), the GAP Insurance provider actually reserves the right to NOT cover any amount by which your Motor Insurer pays out less than the figure quoted by their chosen guide.
Of course, you have barely any influence over how much your Motor Insurer will pay out for your car and you certainly have no influence whatsoever over what any of the guides might state your vehicle is worth!
It doesn't stop there though, because the worst GAP insurance policies also reserve the right to revalue your vehicle at the time you bought it. What this means is that they'll look back at the price you paid for your vehicle originally and compare that to the value that their chosen guide was stating your vehicle was worth at the time you bought it. If they find that the price you paid was more than the value stated in the guide, they'll NOT cover the amount that the figure you paid exceeded the value in the guide.
Of course, there could be a whole host of reasons as to why you paid more than the guide said your vehicle was worth. Not least that perhaps there was more demand for that particular vehicle at the time you bought it than the guide was giving credit for - it is afterall just a "guide" figure and of course the dealer on-the-front-line (so to speak) would naturally want to maximise his sale potential.
Whatever the reason, is it fair that you should suffer financially if your Motor Insurer pays out less than a "guide" expects, and/or if you originally paid a little more for your car than a "guide" thinks you should - particularly when you consider that you have barely any influence over the amount paid out by the Motor Insurer and certainly no influence at all over the figures published in any industry guide?
We don't think it's fair at all. Which is why our policies have neither of these horrid "Market Value" clauses.
To clarify though, if your Motor Insurer at the time of any claim does pay out less than the likes of Glass' Guide suggest they should have done, we do reserve the right to pursue your Motor Insurer for reimbursement, but that wouldn't affect our GAP insurance policy payout to you!
Imagine... your car has been involved in an incident, you may well have been injured in the process. You've got to deal with the fallout from the incident, notifying your insurer, being without your car and so on. It's going to be a pretty hectic and possibly one of the most stressful times and 30 days will fly by in the blink of an eye... will you remember to inform the GAP Insurance company?
Some other policies out there only permit a 90 day notice period. Others still are as low as 30-days. Our policies permit you to make a claim up to 120 days from the date of incident.
This is easily a case of "more" being absolutely "better".
With our policies, if you replace your originally covered vehicle within the policy term, we'll cancel the policy, calculate a daily pro-rata rebate and allow you to transfer that rebate forward in full against the cost of a new policy on your new vehicle - no cancellation, transfer or admin fee will apply.
Some companies will charge you a transfer fee of up to an astounding £50 for the same, whilst others don't permit any kind of transfer in the event that it occurs more than 90 days after you purchase the policy.
You've bought your car, fended off the salesperson's GAP Insurance advances because they were absurdly expensive compared to those prices you found online for better cover. Well done! But then not wanting to spend a great deal of time sat infront of a computer trying to work out which is the best GAP Insurance policy to go for - afterall you could be enjoying your shiny new motor instead - you think you've worked out the best policy and go for it.
Some time later, you finally get chance to analyse the policy in detail and it turns out that it's not quite as good as you first thought it was. You realise that you could have got a better policy from elsewhere so now wish to cancel your existing policy.
Can you do so?
Well, not if more than 21 days has passed since you bought it from some providers!
If after buying a policy from us, you decide that it's not for you, simply let us know within the first 30 days. We'll cancel it and give you every penny of your money back.
This is pretty standard now, but in the event that your car is declared a Total Loss (written off) and you have an excess to pay as part of your valid Car Insurance claim, our GAP insurance policy will cover up to £250 of that excess.
In reality this isn't as much of a big deal as many others would have you believe, but we know it's something that our customers ask us about regularly through a desire to stick with a UK based insurer.
At present, our policies are underwritten by UK General (based in Leeds) on behalf of Great Lakes Reinsurance (based in London). They're administered on a day-to-day basis by ourselves (based in Otley) and claims are administered by MB&G (based in Newcastle).
In the spirit of openness, please note that it would seem that in the advent of "Brexit" Great Lakes Reinsurance have announced plans to move their HQ from London to Germany. We'll publish further information about this as and when it becomes available.
If you go on to modify your vehicle other than by way of modifications approved by the manufacturer, some other GAP insurance policies will be declared entirely void. This is not the case with our policies. All we require is that the modification is suitably declared to your Motor Insurer and that your Motor Insurance policy remains valid.
"Pre-approval" is where you HAVE to speak with the GAP insurance provider BEFORE you accept an offer of settlement from your Motor Insurer. With some other GAP insurance policies out there, failing to do so (and let's face it, if you've just had your vehicle written off it's possibly going to be a stressful time and might well involve your Motor Insurer pressing you (or your own personal circumstances needing you) to accept their offer as quickly as possible) may well resut in the GAP insurance policy payout being reduced as a result. E.g. if you accepted an offer that the GAP insurance provider believed was too low they might not cover the amount of "underpayment".
Clearly, we'd like the opportunity to be involved in the negotiation of settlement with your Motor Insurer. It doesn't take a rocket scientist to work out that the more your Motor Insurer pays out, the less we have to. So we do ask that you notify us of the incident/claim and get us involved as early as possible (it's much easier negotiating at the time rather than at some point in the future). But we accept that things might go awry and for any number of reasons (in the past we've had people simply forget that they've had GAP insurance) that may not happen.
If you accept an offer from your Motor Insurer without speaking to us first and that offer turns out to be too low, we'll settle up with you but we do reserve the right to contact your motor insurer on your behalf to renegotiate that settlement and seek reimbursement of the additional funds we paid to you as a result.
With few exceptions, if the purchase of your car incorporates Negative Equity being carried forward from a previous vehicle, most other GAP insurance policies will entirely exclude that Negative Equity from cover.
With us, for a small additional fee, you can extend the policy to incorporate cover for up to £2,000 of negative equity.
As above, with our policies if you cancel your GAP insurance policy within the first 30 days, so long as no claim has been made you'll receive all of your money back. After 30 days if you cancel your policy, so long as no claim has been bade, we'll cancel your policy and calculate a daily pro-rata rebate of unsued premium that you can either have refunded or carry forward against the cost of a new policy on a new vehicle. No cancellation, transfer or admin fees will apply.
If you need to make changes to your policy (e.g. if you've moved house, changed your name or put private plate on the vehicle), or even if you just need to re-print your policy documentation, you can view, update and/or print your policy online at any time via our website. You can also update your policy over the phone with us too. Either way, such changes etc are all entirely free of charge.
With most other companies, at the pint of expiry of your GAP insurance policy you're either expected to forgo any further GAP insurance cover OR are offered what's referred to as an "Agreed Value" GAP insurance policy. An Agreed Value GAP insurance policy involves you taking out a GAP insurance policy that will only protect you to what your vehicle was worth (normally according to something like Glass' Guide) at the time you bought the Agreed Value policy.
Clearly, this would be a substantially lower level of cover than either an original Invoice GAP insurance policy covering you back up to the original invoice price that you bought the vehicle for or a Replacement GAP insurance policy covering you up to what it would cost to replace the vehicle with a new equivalent at the time of claim.
We don't think that's good enough, particularly as there's a growing trend for people to keep their vehicles for longer periods of time. Thus... Our Invoice & Replacement GAP insurance policies for cars that were purchased either by way of cash or finance (e.g. not Leased), can be renewed.
The conditions for the renewal are that the car must still be less than 10yrs old at the time of purchasing the renewal and you can in theory keep renewing the policy every 12 or 24 months until the car reaches 10-years old (at which point the policy is left to run out with no further cover offered).
It's now pretty common for a Motor Insurance policy to incorporate New-For-Old cover for a brand new vehicle for the first year of ownership. The theory (at least) is that in the event of your vehicle being written off before it's a year old, your Motor Insurer will replace it with an actual new vehicle (e.g. rather than a cash payout).
This isn't without risks though:
* - Some New-For-Old schemes require that the repair damage has to exceed a percentage of the list price of a new equivalent at the time of claim.
* - If your car is financed, the finance company would have to agree to the physical replacement (it never ceases to amaze me/us how that some don't agree!)
* - Some will revert to a Market Value payout in the event that they can't source an exact equivalent replacement vehicle at the time of claim
* - Some purport to offer TWO years New-For-Old cover, except the apply a 12,000 mile limit (a distance most people cover within a year!)
See here for more details of the risks involved in relying on New-For-Old cover from your Motor Insurer.
Nevertheless, if you HAVE New-For-Old cover with your Motor Insurer and you're comfortable that it will cover you suitably during that first year, you can elect to defer the start date of a GAP insurance policy with us, by up to 12 months from when the vehicle was first registered.
This means that you get to avoid "duplicate" cover in the first year but still benefit from GAP insurance cover in the later years.
We've seen various competitor approaches to the policy pay out in our time.
From Replacement GAP insurance policies that only pay out on an Invoice GAP insurance basis in the event that you do not permit the GAP insurance Claim Administrator to organise the supply of your next vehicle, to the payout being made in the form of a credit to a Motor Dealer of the GAP insurance Claim Administrator's choice (or maybe even the to dealer who originally supplied your vehicle) - all of which would be carried out for pretty obvious reasons in favour of the GAP insurance provider (but would limit your ability to source your next car).
We prefer the rather simple approach of simply paying you the money.
So for example, if you bought your vehicle cash-outright originally and that vehicle has now been written off, your Motor Insurer will pay YOU whatever they think the vehicle is worth and we'll top that up to either the original invoice price (Invoice GAP insurance) or the replacment vehicle price (Replacement GAP insurance) by paying the money directly to you.
In the event that you financed your vehicle and there being finance outstanding at the time of claim which hasn't been cleared by your Motor Insurance payout, we'd be obliged to pay the finance company the amount they're due first, but then any excess funds would then be paid directly to you.
You would then be free to use those funds against the cost of sourcing your next vehicle (whatever that may be) from any dealership of your choice. Or not... ultimately, the money is yours, so you'd be free to dispose of it as you saw fit!
We think this is the most convenient and flexible approach for you.
Whilst some other GAP insurance providers insist that you must purchase their policies within 14, 30, 60, 90 or perhaps even 180 days of taking ownership of the vehicle, we're one of few providers who can provide cover up to 12 months after taking ownership of the vehicle.
Note though that there is a minor price increase if you wait more than 6-months.
It's a question you really need to ask yourself.
We're pretty proud of the GAP Insurance policies we've created through a close working relationship with our policy underwriter and very confident that we offer some of, if not THE, best Invoice and Replacement GAP Insurance policies in the UK.
So go ahead and ask yourself, can you afford to buy GAP Insurance elsewhere?