What is Replacement GAP insurance?

At its most basic level, if your car is written off, Replacement GAP insurance aims to pay the difference between your motor insurance pay-out and the cost of replacing your vehicle with a brand new version of the same vehicle at the time of claim. It's also a combination of the three main types of GAP insurance (Finance, Invoice & Replacement GAP insurance) thereby providing the best of all three cover levels, making it the highest level of GAP insurance available.

Our customers have saved

On average
£241

At most
£1,450

Largest claim paid

£48,859

Average claim paid

£10,321

How does Replacement GAP insurance work?

GAP insurance policies don't come much better than this.

Replacement GAP insurance is the highest level of GAP insurance cover available today. It's a combination of the three main types of GAP insurance: Finance GAP, Invoice GAP and Replacement GAP insurance - which means it provides the best of all cover levels.

In the event of your vehicle being declared a Total Loss (written off) through accident, fire, theft, or flood, Replacement GAP insurance aims to pay the difference between your Motor Insurance pay-out and THE HIGHER OF either:

  • The amount (if any) outstanding on finance at the time of claim EXCLUDING any Negative Equity brought forward from a previous vehicle (unless the optional "Negative Equity Cover" was purchased), OR
  • The ORIGINAL PURCHASE PRICE that you paid for your vehicle first time around, OR
  • The cost of REPLACING YOUR VEHICLE with a brand new version of the same (or nearest equivalent) as your original vehicle - even if the replacement vehicle cost is MORE than you bought the vehicle for first time around.

For most people who go on to make a claim, having their motor insurance pay-out topped up to the cost of replacing their vehicle with a brand new equivalent at the time of claim by way of a Replacement GAP insurance claim pay-out, would leave them in the position of being able to both clear any outstanding finance and have money left over - more money than they would have had left over than with any other type of GAP insurance - to put towards the cost of their next car.

In order to determine whether this type of cover is suitable for your needs, either call us on 01484 490095 or contact us here.

Replacement GAP claim example

Policy documents

Do I need Replacement GAP insurance?

GAP insurance is an entirely optional form of insurance and some people will have a greater need for it than others.

Without GAP insurance in force, if your car is written off, you'd only have your motor insurance pay-out coming your way. If you have finance outstanding on your written-off vehicle, your motor insurance pay-out may not be sufficient to clear the outstanding balance, in which case, you'd have to use your own funds to both clear the remaining finance on the written off vehicle and fund a replacement vehicle and it's entirely possible that by the time of claim, a brand new version of the same vehicle might then be more expensive than you paid for your original vehicle.

This is where Replacement GAP insurance goes above and beyond, by not only aiming to cover the difference between your motor insurance payout and the original invoice price that you bought your vehicle for, but also covering any amount by which the cost of a brand new version of the same (or nearest equivalent) vehicle has increased.

In short... if you can comfortably afford to stand the combined cost of clearing any finance outstanding (where applicable) and replacing your vehicle in the event it's written off - including covering any increase in the cost of a brand new equivalent - you probably don't need GAP insurance. However if you could not comfortably afford to replace your vehicle or, you'd prefer that your own savings were not 'hit' by the cost of replacing your vehicle if it was written off, therein lies the need for Replacement GAP insurance.

Am I eligible for Replacement GAP insurance?

You can buy Replacement GAP insurance to cover a New car that:

  • Is covered by a comprehensive motor insurance policy.
  • You are the very first and only registered keeper of.
  • Is less than 30 days old at the start date of this policy.
  • You have not yet taken delivery of or, you took ownership/delivery of within the last 30 days.
  • You have NOT changed in any way from the vehicle manufacturer's standard specification, unless the vehicle has been modified for mobility purposes. This would include changes to the bodywork, such as spoilers or body kits, changes to the suspension or brakes, and changes affecting performance such as engine management. Graphics applied to your vehicle are acceptable.
  • Has not previously been declared a Total Loss and is not already the subject of a previous incident or existing motor insurance claim which could yet result in it being declared a Total Loss.
  • Is registered in the UK.
  • Was bought for no more than £35,000.
  • Is not a commercial vehicle.
  • Is not being used for rallying, racing, any competitive events or for emergency use or hire (including private hire, taxis and chauffer) or for driving school tuition.
  • Is not already covered by a GAP insurance policy.
  • Was bought cash outright, personal loan (secured or not), or financed by way of a HP, PCP or Conditional Finance Agreement.
  • Is not a specifically excluded vehicle.
  • Is not a van, car derived van, motorcycle, motorhome or campervan.

So long as you:

  • Are a permanent resident in the UK or a UK registered company.
  • Bought the vehicle from a VAT registered motor dealer.

You can NOT buy Replacement GAP insurance for a vehicle that:

  • Is not covered by a comprehensive motor insurance policy.
  • You are not the very first registered keeper of.
  • Is more than 30 days old at the start date of this policy.
  • You took ownership/delivery of more than 30 days ago.
  • You have changed in any way from the vehicle manufacturer's standard specification, unless the vehicle has been modified for mobility purposes. This would include changes to the bodywork, such as spoilers or body kits, changes to the suspension or brakes, and changes affecting performance such as engine management. Graphics applied to your vehicle are acceptable.
  • Has previously been declared a Total Loss or, is already the subject of a previous incident or existing motor insurance claim which could yet result in it being declared a Total Loss.
  • Is not registered in the UK.
  • Was bought for more than £35,000.
  • Is a commercial vehicle.
  • Is used for rallying, racing, any competitive events or for emergency use or hire (including private hire, taxis and chauffer) or for driving school tuition.
  • Is already covered by a GAP insurance policy.
  • Is the subject of a Contract/Lease Hire Agreement.
  • Is a van, car derived van, motorcycle, motorhome or campervan.
  • Is a specifically excluded vehicle.

Key features of Replacement GAP insurance

  • Combined Finance, Invoice & Replacement GAP - Covering up to the greater of either the outstanding finance, original invoice price or replacement vehicle price
  • Available for Cars, up to 1 month(s) old, purchased from an authorised dealer or finance house.
  • NO Market Value clauses.
  • Ability to cancel the policy at any time and receive a daily pro-rata refund of unused premium (a cancellation fee may apply)
  • CASH payout to you rather than to a nominated dealer, leaving you free to choose the provider of your replacement vehicle
  • Available for Cars bought for up to £35,000.
  • OPTION to include cover for up to £2,000 of negative equity brought forward from your previous vehicle.
  • Underwritten by DTW 1991 Underwriting Limited on behalf of Syndicate DTW1991 at Lloyd's.
  • 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.
  • NO right to revalue the purchase price of your vehicle at the time you bought it.
  • Policy durations of up to 3 years available.
  • Claim Limits of up to £35,000. available.
  • FREE policy amendments.
Feature
Details

A-Rated Insurer?

NO Pre-Approval clause with penalty?
Some policies from some GAP insurance providers strictly enforce that you must seek the claim administrator's approval before accepting an offer from your motor insurer, with you forfeiting some or all of your GAP insurance claim in the event that you don't.

Ability to cover Negative Equity brought forward from a previous vehicle?


Max £2,000
Subject to an additional fee being paid.

Initial Cooling Off Period?
Cancel within this period and receive a full refund if no claim has been made

30 Days

Pro-Rata rebate of unused premium if you cancel outsde of the initial Cooling Off Period?
If you sell your vehicle and cancel the policy early with no claim having been made, do you get some of your money back?


Daily Calculation

Pays out in cash to the policyholder?
Some Replacement GAP insurance policies from some providers will contractually oblige you to allow them to source your next vehicle for you. Others may insist that you deal with a motor dealer that they nominate to source your next car. Thereby denying you the flexibility to choose which car you get next, from which dealer or even whether you wish to use the funds towards a new car at all.

After all parties with an interest in the vehicle have been paid (e.g. a finance company), any/all excess funds are paid directly to the policyholder leaving them free to use those funds against the cost of sourcing any vehicle from any dealership of their choice.
Cover for dealer fitted accessories?

Up to £1,500 worth
Transferrable?
If you sell your vehicle and have not claimed on your GAP insurance policy, can the unused portion be transferred forward on a new vehicle?
We will cancel your policy and allow you to transfer forward, the financial value of the remaining period of your cover, against the cost of a new policy on a new vehicle. No cancellation, transfer or admin fees will apply.
Will pay towards your Motor Insurance excess in the event of a successful Total Loss claim?

£250
NO Market Value clauses?
A Market Value clause permits the claim administrator to reduce the amount of your claim based either on their belief that you paid too much for it when you originally bought your vehicle or, if your motor insurer pays out less than they think your car is worth at the time of claim - potentially both. Where possible you should avoid any GAP insurance policy that has one or more market value clauses permitting such a reduction in the amount of claim.

None
Maximum age of vehicle that can be covered?
30-days old
Maximum vehicle value?
£35,000.
Maximum Claim Limit available?
(Subject to the vehicle value)
£35,000.
Maximum duration of cover available?
3 Years

Is there a cancellation Fee if cancelled outside of the initial Cooling Off Period?


£30.00
Waived if a new policy is purchased.

How long after taking delivery of the vehicle, do have to buy GAP insurance?

30-days
Available for both New and Used vehicles?

Brand New, 1st keeper only.

Allows for vehicles to be modified?

Recent Replacement GAP insurance claims

Below are a selection of our most recent Replacement GAP insurance claims:

Volvo XC90

Volvo XC90
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
September 2019
£48,760
October 2020
£13,289
Length of ownership:
13 Months
Rate Of Depreciation:
An average of £1,022.23 per month*
Total Depreciation:
27.25% of its original Invoice Price during the 13 months it was owned.*
Policy Cost:
The policy cost £370.81 (2.79% of the amount the policy paid out.)

Skoda Octavia

Skoda Octavia
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
June 2018
£11,990
September 2020
£5,095
Length of ownership:
27 Months
Rate Of Depreciation:
An average of £188.70 per month*
Total Depreciation:
42.49% of its original Invoice Price during the 27 months it was owned.*
Policy Cost:
The policy cost £249.64 (4.90% of the amount the policy paid out.)

Audi S8

Audi S8
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
March 2018
£37,000
July 2020
£21,765
Length of ownership:
28 Months
Rate Of Depreciation:
An average of £777.32 per month*
Total Depreciation:
58.82% of its original Invoice Price during the 28 months it was owned.*
Policy Cost:
The policy cost £196.64 (0.90% of the amount the policy paid out.)

Audi TTS Coupe

Audi TTS Coupe
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
January 2018
£31,000
July 2020
£11,430
Length of ownership:
30 Months
Rate Of Depreciation:
An average of £381.00 per month*
Total Depreciation:
36.87% of its original Invoice Price during the 30 months it was owned.*
Policy Cost:
The policy cost £240.86 (2.11% of the amount the policy paid out.)

BMW M4

BMW M4
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
August 2018
£81,000
July 2020
£36,384
Length of ownership:
23 Months
Rate Of Depreciation:
An average of £1,581.93 per month*
Total Depreciation:
44.92% of its original Invoice Price during the 23 months it was owned.*
Policy Cost:
The policy cost £588.25 (1.62% of the amount the policy paid out.)

Mercedes-Benz GLC-Class

Mercedes-Benz GLC-Class
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
December 2017
£47,000
June 2020
£17,781
Length of ownership:
30 Months
Rate Of Depreciation:
An average of £592.70 per month*
Total Depreciation:
37.83% of its original Invoice Price during the 30 months it was owned.*
Policy Cost:
The policy cost £436.97 (2.46% of the amount the policy paid out.)

Land Rover Range Rover Sport

Land Rover Range Rover Sport
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
July 2017
£62,175
June 2020
£33,889
Length of ownership:
35 Months
Rate Of Depreciation:
An average of £968.26 per month*
Total Depreciation:
54.51% of its original Invoice Price during the 35 months it was owned.*
Policy Cost:
The policy cost £389.00 (1.15% of the amount the policy paid out.)

Honda Jazz

Honda Jazz
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
March 2018
£17,525
June 2020
£7,599
Length of ownership:
27 Months
Rate Of Depreciation:
An average of £281.44 per month*
Total Depreciation:
43.36% of its original Invoice Price during the 27 months it was owned.*
Policy Cost:
The policy cost £193.31 (2.54% of the amount the policy paid out.)

BMW 4 SERIES

BMW 4 SERIES
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
October 2017
£42,000
May 2020
£18,537
Length of ownership:
31 Months
Rate Of Depreciation:
An average of £597.97 per month*
Total Depreciation:
44.14% of its original Invoice Price during the 31 months it was owned.*
Policy Cost:
The policy cost £212.03 (1.14% of the amount the policy paid out.)

Mazda 2

Mazda 2
Vehicle Purchased
Invoice Price
GAP Claim
GAP Payout
August 2017
£6,000
May 2020
£3,289
Length of ownership:
33 Months
Rate Of Depreciation:
An average of £99.66 per month*
Total Depreciation:
54.81% of its original Invoice Price during the 33 months it was owned.*
Policy Cost:
The policy cost £102.04 (3.10% of the amount the policy paid out.)