Gap insurance advice

[greamec]

Hi all,

Trying to work out best option and find best price.


Just purchased a second hand car for £7000 from main dealer and would like some peace of mind. Plan on keeping the car at least 3 years.
What is the best / cost effective gap cover.

I have not been on the forum for a while but remember the quotes for pistonheads insurance were always raved about for price. My initial research is telling me otherwise so any advice/ tips would be welcome as I know policies can vary.

Many thanks Greame

[fatboy b]

Google ‘gap insurance’. Make your own mind up if you want it. No need to ask on here.

[SteveC72]

fatboy b said:

Google ‘gap insurance’. Make your own mind up if you want it. No need to ask on here.

That’s a bit harsh, man. The guy wants a bit of advice from some like minded people.

[greamec]

fatboy b said:

Google ‘gap insurance’. Make your own mind up if you want it. No need to ask on here.

Try getting out of the other side in the morning, see how your day goes

[greamec]

SteveC72 said:

That’s a bit harsh, man. The guy wants a bit of advice from some like minded people.

Thanks brother Steve

[kelevraz]

I bought RTI (return to invoice) gap insurance when i bought my car for 12k in 2016, it cost me £349 over 4 years, so added something like a £8 to the monthly bill. Ironically, at the time i didn't even really know all that much about gap insurance

The car was stolen recently, and my insurer's first offer came in at 8.5k

Didn't need to argue with them, didn't need to try and get them to negotiate a larger settlement or any of that bks. Just forwarded the offer onto my gap insurer with all the relevant documents.

The only thing they said to me when i contacted them (other than get us X docs) was 'don't accept any offer from your insurer, as if they try to low ball you, we'll negotiate on your behalf for them to pay more, as its in our interest that they give you as high an offer as possible'

5 Days later, my GAP insurer wrote back saying they had no problems, and were happy to settle and pay the remaining £3.5k

Best £349 i've ever spent

Edited by kelevraz on Thursday 16th May 21:17

[greamec]

kelevraz said:

I bought RTI (return to invoice) gap insurance when i bought my car for 12k in 2016, it cost me £349 over 4 years, so added something like a £8 to the monthly bill. Ironically, at the time i didn't even really know all that much about gap insurance

The car was stolen recently, and my insurer's first offer came in at 3.5k

Didn't need to argue with them, didn't need to try and get them to negotiate a larger settlement or any of that bks. Just forwarded the offer onto my gap insurer with all the relevant documents.

The only thing they said to me when i contacted them (other than get us X docs) was 'don't accept any offer from your insurer, as if they try to low ball you, we'll negotiate on your behalf for them to pay more, as its in our interest that they give you as high an offer as possible'

5 Days later, my GAP insurer wrote back saying they had no problems, and were happy to settle and pay the remaining £4.5k

Best £349 i've ever spent

Nice which company did you use? Return to invoice looks like the cheapest option but was wondering if it is worth paying more, not sure I understand the other type of gap though.

Thanks Greame

[kelevraz]

greamec said:

Nice which company did you use? Return to invoice looks like the cheapest option but was wondering if it is worth paying more, not sure I understand the other type of gap though.

Thanks Greame

I used auto protect, was sold it with the car though, not sure if you can just buy through them directly tbh. And it was a combined RTI and GAP policy i had

The other type of GAP (i think its called contract hire gap) can actually be more beneficial depending really on how much you owe the finance company as a result of whatever loan you've taken.

So you say your car cost £7k, i dont know if you took any car finance for this? Lets you assume you did. If you didnt, then i dont think you would be sold GAP, you'd only need RTI

Lets say the car 'price' was £7k - you showed up to the dealership with £4k, and they financed you the remainder, so lets say they loaned you £3k, but including interest, you will have to pay them back £4k all together.

If 2 years later, you've paid off £2k, you still owe the finance company £2k.

RTI will simply get you back £7k in your hands, this was the invoice price. You'd then have to pay back the finance company using this money (mine was 'combined', so in the situation that i hadn't paid off the finance company, they'd have done it for me)

GAP, will cover the amount of money you still owe the finance company.

The reason i prefer RTI, is that, if for whatever reason you pay off all the finance - there is no GAP to cover, so you simply have to live with whatever your insurer offers you. If i only had GAP and not RTI, i'd have been forced to just accept my insurers offer - as there would've been no GAP to cover

Whereas RTI will get you back the 'invoice' price you paid for the car.

Conclusion - if you got finance, take a combined policy. If you paid cash, just get RTI

Edited by kelevraz on Thursday 16th May 22:00

[oilslick]

Try the 'Hello from ALA Insurance' thread at the top of this forum. I've bought gap insurance through them a couple of times and they've been very reasonably priced.

[kelevraz]

Theres also vehicle replacement gap - which if im correct, covers the difference between your insurers settlement, and the cost to buy another car of the same spec, even if this would cost more than the original purchase.

Apparently, many people say this is actually the 'best' type, my only issue with it, is that it involves more back and forth with the GAP insurer, as essentially, they have to agree that the car your going for is not BETTER than the one you originally had

[Burwood]

Back to invoice on used is fine. Back to invoice on new needs the one over that option in the case where you negotiated a great deal and may not get that deal again. I’ve found ALA very good to deal with. Pistonheads discount code

[Terzo123]

Never buy gap from the dealer you are buying the car from. The mark up the put on the price of the policy is eye watering.

I paid about 160 quid for a RTI policy from ALA for my C63. I googled ALA discount codes which helped bring the price down.

Mercedes wanted 400 quid if memory serves me right for a similar policy.

[Burwood]

Terzo123 said:

Never buy gap from the dealer you are buying the car from. The mark up the put on the price of the policy is eye watering.

I paid about 160 quid for a RTI policy from ALA for my C63. I googled ALA discount codes which helped bring the price down.

Mercedes wanted 400 quid if memory serves me right for a similar policy.

Correct.

[Gary C]

greamec said:

Hi all,

Trying to work out best option and find best price.


Just purchased a second hand car for £7000 from main dealer and would like some peace of mind. Plan on keeping the car at least 3 years.
What is the best / cost effective gap cover.

I have not been on the forum for a while but remember the quotes for pistonheads insurance were always raved about for price. My initial research is telling me otherwise so any advice/ tips would be welcome as I know policies can vary.

Many thanks Greame

Why do you want it ?

Is it just to stop you from owing more on any loan that any insurance payout, or would you want to use it to buy a replacement for 7K even after three years ?

Gap and return to invoice are often called the same but are different.

I had RTI on my brand new Subaru STi, which meant that when it got stolen after 3.5 years, I got the value of what the car cost new, even though it was three and a half years old. It did cost £300, but as it kicked in after the first year had passed, it seemed a good deal........as it worked out to be.

[Mr Tidy]

Terzo123 said:

Never buy gap from the dealer you are buying the car from. The mark up the put on the price of the policy is eye watering.

I learnt that the hard way back in 2005. I did wonder if I should have parked the car in a ditch just before the cover expired though!

Still once I got to grips with it I just wondered why you'd need to insure against depreciation - surely that's just reality?

[oilslick]

Mr Tidy said:

I learnt that the hard way back in 2005. I did wonder if I should have parked the car in a ditch just before the cover expired though!

Still once I got to grips with it I just wondered why you'd need to insure against depreciation - surely that's just reality?

Often if you're financing you're likely to be underwater for a while, gap will cover the shortfall if anything happens and your insurance payout is less than the outstanding finance amount.

[Mr Tidy]

oilslick said:

Often if you're financing you're likely to be underwater for a while, gap will cover the shortfall if anything happens and your insurance payout is less than the outstanding finance amount.

Yes, but isn't that just the inherent price of finance?

Mind you I've never bought what I couldn't afford!

[greamec]

Well what can I say!!! Thanks very much everyone that's a great help. Just to clarify I purchased the car for cash and part exchanged the old one. I take it I am covered for the full sale price and not just the amount of cash I paid ( does that make sense?) . I will get a quote from the company suggested.
Thanks again greame

[Cold]

You also have to weigh up the cost of the policy with the potential for actually using it. For me, I haven't needed any insurance (legalities aside) for the past 35 years for at least two cars at a time (sometimes four - his and hers) yet still have had to pay the necessary premiums.

So from a financial perspective I'm way behind and therefore adding the extra expense of Gap would be pointless given the impeccable knowledge of hindsight. Of course, that monetary disadvantage could be wiped out on a trip to the supermarket this afternoon - or it continue for another 35 years.

"You've got to ask yourself one question: 'Do I feel lucky?' Well do ya?"

[Bob-2146]

Gap insurance is a massive con. “Yes sir please give me the extended warranty and the alloy wheel cover” ...

If you must have it never buy from a dealer. Ala gap on here will quote you I believe.