gap insurance worth having?
Discussion
I thought that Gap insurance only applied where finance was involved - to meet the gap between the depreciated value of the car and the financial settlement to repay the owed finance. If your car is stolen after 6 months then the financial settlement from the insurer should provide you with enough cash to buy a 6 month old similar vehicle (in theory), what would the gap insurance cover?
I'd run some insurance quotes with/without a tracker and see what the difference is. Obviously this isn't the whole story, but if you're saving say £70 a year on insurance then it could be a worthwhile investment.
I'd run some insurance quotes with/without a tracker and see what the difference is. Obviously this isn't the whole story, but if you're saving say £70 a year on insurance then it could be a worthwhile investment.
Yes Gap Insurance is for Finance only, so won't be relevant to you. Basically it means you get your full money back if the car is written-off: i.e. market value at time of loss from your regular insurer + the Gap insured difference to the original price paid. In my case it's 100 quid per annum for a max Gap pay-out of 15k, which doesn't seem too bad. Of course like all insurance it's not worth it if you don't need it!
My two penneth. I recently had my Merc C Estate stolen in a car key theft. Car was on finance, owned from new and 15 months old at time of stealing. Up to 12 months old, you should get new for old replacement, therefore Gap not needed. Where it is useful is plugging the gap between settlement from insurers and settlement figure from finance. Now perhaps I was lucky, but I didn't go for gap, yet insurers gave me a figure which settled the finance and saw me 1.5k back in profit so I got some of my deposit back. If it's a slow depreciator then gap not really necessary. If it's a full price £30k Mondeo/Renault/Alfa that will depreciate quickly in its first year, then yes.
If there's any ham-fistedness or typos my apologies, my sausage fingers are typing this out on a phone...!!
If there's any ham-fistedness or typos my apologies, my sausage fingers are typing this out on a phone...!!
If you're not buying it on finance then you will have been offered return to invoice price gap (RTI). Essentially after your first year (where most insurance polices cover you for a new car anyway if you've bought brand new) it will pay the difference between an insurance payout and the invoice price of your car. The principle is that you bought a new car, were able to spec it yourself, got the options you wanted, no-one else had ragged it, farted on the seats etc and so will be back where you started.
Whether that is worth it to you is down to your own preference. If I were buying a new car I would look at buying RTI gap.
Whether that is worth it to you is down to your own preference. If I were buying a new car I would look at buying RTI gap.
In my view, it's definitely worth it in a finance situation and probably worth it in a straight cash buy, but....
Don't pay the dealer's asking price for it! There's always a lot of margin in the dealer's headline price - so plenty of room to haggle them down. And you don't need to buy it from the dealer - there are providers on-line who will be a lot cheaper.
Don't pay the dealer's asking price for it! There's always a lot of margin in the dealer's headline price - so plenty of room to haggle them down. And you don't need to buy it from the dealer - there are providers on-line who will be a lot cheaper.
My friend brought a Focus CC for 16.5k new in 2008 (madness!!). Early lasy year he was considering trading it in for another car and was offered less than the amount to clear the finance and that was it so thought he may aswell keep it rather than pay to get rid of it. Around 5 months after that someone pulled out of a side turning straight into the side of him writing the car off.
Insurance payout was £10000 letting them keep the car not enough to clear the finance though.
GAP paid out around £6k meaning siad car had cost nothing but interest on finance and cost of GAP.
As previously stated useless if you don't use it, or have a seroius accident in the first year but potentially useful in the right scenario. I think it is possible to get the cover defered for a year if your insurance replaces your car like for like in the first year.
I personally haven't purchased it for any of the new cars i have ever had as it's just one more thing to pay out for that you probably won't use IMO like most insurance.
HTH
Insurance payout was £10000 letting them keep the car not enough to clear the finance though.
GAP paid out around £6k meaning siad car had cost nothing but interest on finance and cost of GAP.
As previously stated useless if you don't use it, or have a seroius accident in the first year but potentially useful in the right scenario. I think it is possible to get the cover defered for a year if your insurance replaces your car like for like in the first year.
I personally haven't purchased it for any of the new cars i have ever had as it's just one more thing to pay out for that you probably won't use IMO like most insurance.
HTH
Your insurance company should fund a replacement X3 of similar age/spec. However the X3 is a brand new model and there are only ex-demos available (at full price!) or a nine-month waiting list. I can't see how the insurance company can (legitimately) short change you, should your vehicle need replacing.
DanielJames said:
In my opinion, which is highly influenced by PH, no.
Putting faith in the finance "gurus" round here possibly isn't the best way to go about things.LotusOmega375D said:
Yes Gap Insurance is for Finance only, so won't be relevant to you.
An exmple of some of the typical b
ks to ilustrate my point.Froomee said:
My friend brought a Focus CC for 16.5k new in 2008 (madness!!). Early lasy year he was considering trading it in for another car and was offered less than the amount to clear the finance and that was it so thought he may aswell keep it rather than pay to get rid of it. Around 5 months after that someone pulled out of a side turning straight into the side of him writing the car off.
Insurance payout was £10000 letting them keep the car not enough to clear the finance though.
GAP paid out around £6k meaning siad car had cost nothing but interest on finance and cost of GAP.
As previously stated useless if you don't use it, or have a seroius accident in the first year but potentially useful in the right scenario. I think it is possible to get the cover defered for a year if your insurance replaces your car like for like in the first year.
I personally haven't purchased it for any of the new cars i have ever had as it's just one more thing to pay out for that you probably won't use IMO like most insurance.
HTH
He had been paying the car off for 2/3 years and hadn't made a dent in any of the £16k finance amount?!? What kind of finance deal what that! Insurance payout was £10000 letting them keep the car not enough to clear the finance though.
GAP paid out around £6k meaning siad car had cost nothing but interest on finance and cost of GAP.
As previously stated useless if you don't use it, or have a seroius accident in the first year but potentially useful in the right scenario. I think it is possible to get the cover defered for a year if your insurance replaces your car like for like in the first year.
I personally haven't purchased it for any of the new cars i have ever had as it's just one more thing to pay out for that you probably won't use IMO like most insurance.
HTH
GBDG said:
Froomee said:
My friend brought a Focus CC for 16.5k new in 2008 (madness!!). Early lasy year he was considering trading it in for another car and was offered less than the amount to clear the finance and that was it so thought he may aswell keep it rather than pay to get rid of it. Around 5 months after that someone pulled out of a side turning straight into the side of him writing the car off.
Insurance payout was £10000 letting them keep the car not enough to clear the finance though.
GAP paid out around £6k meaning siad car had cost nothing but interest on finance and cost of GAP.
As previously stated useless if you don't use it, or have a seroius accident in the first year but potentially useful in the right scenario. I think it is possible to get the cover defered for a year if your insurance replaces your car like for like in the first year.
I personally haven't purchased it for any of the new cars i have ever had as it's just one more thing to pay out for that you probably won't use IMO like most insurance.
HTH
He had been paying the car off for 2/3 years and hadn't made a dent in any of the £16k finance amount?!? What kind of finance deal what that! Insurance payout was £10000 letting them keep the car not enough to clear the finance though.
GAP paid out around £6k meaning siad car had cost nothing but interest on finance and cost of GAP.
As previously stated useless if you don't use it, or have a seroius accident in the first year but potentially useful in the right scenario. I think it is possible to get the cover defered for a year if your insurance replaces your car like for like in the first year.
I personally haven't purchased it for any of the new cars i have ever had as it's just one more thing to pay out for that you probably won't use IMO like most insurance.
HTH
So in that 18 months around 3.5k was cleared plus interest.
Finance was 3 years plus GMFV total interest of around 2K over 3 years.
Egbert Nobacon said:
Buy Gap or RTI (Return to invoice) cover if you wish BUT, get independant quotes from elsewhere. Dealers/finance companies load these premiums massively and earn/pay commission on them.
I did have to laugh recently when I was at BMW looking at a new car - the salesman spent longer trying to sell me the add-ons than the car itself, despite me making clear I was not interested in them - even their amazing 'door dent protection policy'.These things worked out to over £1500, and I know would have cost the dealership at the very most £500.
In the last year I've bought (or been involved in buying) 3 cars, and for each went to various dealers to have a look. The salesmen I bought from actually listened to what we wanted, and offered it to us. It's amazing how many s
t salesmen there are out there, who turn a relatively simple transaction into a frustrating nightmare.LotusOmega375D said:
Yes Gap Insurance is for Finance only
WRONG.There are 2 types of gap. finance gap which pays any gap between payout and what you owe, and gap to invoice which gives difference between payout and invice price you paid at any time during the policy.
BMW will try to charge you an arm and a leg for it, but can offer it at a price work taking - we got gap to invoice for 3 years for a £30k car for £130. Worth taking at that price - they even spread that over 12 months interest free.
So if your car is written off 2 years and 11 months after buying it we get the insurance payout, and then BMW gap gives us the difference to what we paid for the car.
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