GAP insurers suspend sales
Discussion
https://www.fca.org.uk/news/press-releases/gap-ins...
80% of GAP insurers have agreed to suspend sales of new policies after the FCA reported they offer poor value.
Key figures-
Only 6% of the total paid in premiums are paid back in claims
Up to 70% commission of the premium paid to resellers, quite often car dealerships selling policies alongside a car sale.
Interesting to see how this changes the market once they conclude their findings.
80% of GAP insurers have agreed to suspend sales of new policies after the FCA reported they offer poor value.
Key figures-
Only 6% of the total paid in premiums are paid back in claims
Up to 70% commission of the premium paid to resellers, quite often car dealerships selling policies alongside a car sale.
Interesting to see how this changes the market once they conclude their findings.
Ham_and_Jam said:
https://www.fca.org.uk/news/press-releases/gap-ins...
80% of GAP insurers have agreed to suspend sales of new policies after the FCA reported they offer poor value.
Key figures-
Only 6% of the total paid in premiums are paid back in claims
Up to 70% commission of the premium paid to resellers, quite often car dealerships selling policies alongside a car sale.
Interesting to see how this changes the market once they conclude their findings.
When I bought my 335d, 7 years ago, I insured via NFU (same as the previous E36). The insurance was good value then, AND included as standard a GAP policy for two years.80% of GAP insurers have agreed to suspend sales of new policies after the FCA reported they offer poor value.
Key figures-
Only 6% of the total paid in premiums are paid back in claims
Up to 70% commission of the premium paid to resellers, quite often car dealerships selling policies alongside a car sale.
Interesting to see how this changes the market once they conclude their findings.
I would have bought GAP on my recent new car purchase, but discovered you get a year's equivalent cover free with AA insurance.
It could be other insurers do this as well? They replace your car with another the same spec/miles or give you the purchase cost back if they can't. Only applies if the car is brand new or pre-reg with under 250 miles at purchase.
It could be other insurers do this as well? They replace your car with another the same spec/miles or give you the purchase cost back if they can't. Only applies if the car is brand new or pre-reg with under 250 miles at purchase.
Haltamer said:
If people *want* to buy it, why should they stop selling it?
It's the one policy type I have had the least hassle and most value from!
Don't be ridiculous. That would be free will.It's the one policy type I have had the least hassle and most value from!
Don't you realise that you can only do things nowadays if the Nanny State deems it 'safe' for you to do so......
I bought 5 years of Replacement GAP cover on my MX5 in 2019, the car cost me £23k at the time and the same spec is closer to £35k now. From memory it was ~£300 for that level and period of cover, which seems very decent. I kept wishing someone would drop a skip on it or that it would catch fire 
I suspect this is more about the pisstake policies that dealers (used and new) try to push you that cost 2x - 3x as much as going to market and probably don't pay out anyway. Personally I think if you're enough of a mug to buy what the salesman offers without shopping around you deserve to get your leg lifted, but apparently personal responsibility for your own decisions isn't something we have any more.
I suspect this is more about the pisstake policies that dealers (used and new) try to push you that cost 2x - 3x as much as going to market and probably don't pay out anyway. Personally I think if you're enough of a mug to buy what the salesman offers without shopping around you deserve to get your leg lifted, but apparently personal responsibility for your own decisions isn't something we have any more.
GeniusOfLove said:
I suspect this is more about the pisstake policies that dealers (used and new) try to push you that cost 2x - 3x as much as going to market and probably don't pay out anyway. Personally I think if you're enough of a mug to buy what the salesman offers without shopping around you deserve to get your leg lifted, but apparently personal responsibility for your own decisions isn't something we have any more.
100%I always ignored the £400 policy BMW offered & arranged it independently through ALA.
First experience was a £400 ish policy bought through Audi, turned out to be money well spent when the car was written off in an accident 2 years later.
We have paid much less for subsequent policies.
Bring back Deming, wasn’t one of his quotes that “the law is not there to prevent a fool from being parted from his money”? It appears that these days it is.
We have paid much less for subsequent policies.
Bring back Deming, wasn’t one of his quotes that “the law is not there to prevent a fool from being parted from his money”? It appears that these days it is.
Mr Tidy said:
I don't push my budget to get a car I can barely afford, and don't plan to put it backwards into a hedge or ditch!
But depreciation is what happens in the real world so get used to it.
Flip side:But depreciation is what happens in the real world so get used to it.
I PCP’d a car I could otherwise afford outright.
Took out gap insurance via ALA direct at £150 for 3 years.
Some numpty runs into me & I get my invoice figure back, not the market value.
A win in anyone’s book surely.
Not everyone who PCP’s is a turkey teeth white Audi driving tattoed moron.
Some of us just saw stupidly low interest rates coupled with ambitious residuals that let us drive nearly new (in my case ex-demo 530d) cars for £260 a month.
If I could achieve that and end up quids in in the event of an insurance write off then that’s just prudence.
The chippiness on this site about those who ‘don’t buy outright’ is bonkers.
For the record I got fed up with the frankly w
k main dealer experience and now own outright a 2015 Range Rover, so clearly haven’t got 2 pennies to rub together.Stick Legs said:
Flip side:
I PCP’d a car I could otherwise afford outright.
Took out gap insurance via ALA direct at £150 for 3 years.
Some numpty runs into me & I get my invoice figure back, not the market value.
A win in anyone’s book surely.
Not everyone who PCP’s is a turkey teeth white Audi driving tattoed moron.
Some of us just saw stupidly low interest rates coupled with ambitious residuals that let us drive nearly new (in my case ex-demo 530d) cars for £260 a month.
If I could achieve that and end up quids in in the event of an insurance write off then that’s just prudence.
The chippiness on this site about those who ‘don’t buy outright’ is bonkers.
For the record I got fed up with the frankly wk main dealer experience and now own outright a 2015 Range Rover, so clearly haven’t got 2 pennies to rub together.
Good post, agree on all points. I used PCP and because of the favorable interest rates, incentives, and residuals it worked out cheaper than buying a 3 year old car and running it for the same period. I PCP’d a car I could otherwise afford outright.
Took out gap insurance via ALA direct at £150 for 3 years.
Some numpty runs into me & I get my invoice figure back, not the market value.
A win in anyone’s book surely.
Not everyone who PCP’s is a turkey teeth white Audi driving tattoed moron.
Some of us just saw stupidly low interest rates coupled with ambitious residuals that let us drive nearly new (in my case ex-demo 530d) cars for £260 a month.
If I could achieve that and end up quids in in the event of an insurance write off then that’s just prudence.
The chippiness on this site about those who ‘don’t buy outright’ is bonkers.
For the record I got fed up with the frankly w
k main dealer experience and now own outright a 2015 Range Rover, so clearly haven’t got 2 pennies to rub together.The "I don't plan to crash it" argument is patently facile, by that logic why insure it at all, or wear your seatbelt?
Don't forget that whilst GAP cover bought thru a main dealer is far more expensive than an online offering, they do offer added value. The dealership will usually carry out the purchase for you, so you don't have to trawl thru the internet and complete the application. In the event of a claim, I know my Mercedes dealer will do all the paperwork and submit and sort out the claim for you.
Now that might not be worth paying hundreds of pound for many people, and it wouldn't be to me, but to others, it's worth paying over the odds to have someone else do everything for you.
Now that might not be worth paying hundreds of pound for many people, and it wouldn't be to me, but to others, it's worth paying over the odds to have someone else do everything for you.
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