gap insurance - worth it?
Discussion
Birdster said:
A friend of mine had it and it was useful when his used 911 was stolen after a few months. Got the full purchase price. Not sure if that was just because the car couldn't have really depreciated much in that time.
Well no the whole purpose of GAP insurance is to cover the difference between the payout and the purchase price of the vehicle.If you buy it and dont use it- You'll think "oh well"
Dont buy it and get into a pang- Lots of swear words
Buy and and have to use it- Best £80 you'll ever spend.
GF got 5 year gap on her Mini for £112.
6 months later, lorry goes into her car, gap covers £1100 shortfall, including the £90 road tax on the car!
Dont buy it and get into a pang- Lots of swear words
Buy and and have to use it- Best £80 you'll ever spend.
GF got 5 year gap on her Mini for £112.
6 months later, lorry goes into her car, gap covers £1100 shortfall, including the £90 road tax on the car!
Janesy B said:
Well no the whole purpose of GAP insurance is to cover the difference between the payout and the purchase price of the vehicle.
That is Return To Invoice price (RTI) gap.Financial shortfall gap covers the difference between an insurance payout and a finance settlement so you don't end up paying out on a car you no longer have if the car is an insurance loss whilst a finance deal on it is in negative equity.
Personally I think both are worthwhile products.
Craikeybaby said:
Yes, but shop around for it, rather than buy one that you are offered, most likely by someone getting a commission for selling it.
This.. When I looked for GAP on the Cayman, the dealer was some 4 x more expensive than searching online. They load these products up with so much profit. I suspect it also depends how much you are spending on a car, whether it is worth it.With all insurance on average more is paid in premiums than is paid out in claims, otherwise insurance companies would go out of business so, on average, insurance is never worthwhile.
But the problem is that is the average of a lot of people, for some they will get back more than they pay in and it's a question of whether you will be one of them.
My view is to insure against events you couldn't afford and don't insure against events you can.
But the problem is that is the average of a lot of people, for some they will get back more than they pay in and it's a question of whether you will be one of them.
My view is to insure against events you couldn't afford and don't insure against events you can.
Your normal insurance won't put you in a better car than the one you've just written off. In the even of it being written off, Gap insurance enables you to upgrade your car to either a new one or one that is worth what your outstanding finance is worth. It covers a relatively small sum for a narrow range of circumstances, and looks like very poor value for money compared to a standard insurance policy covering what the car is actually worth, the cost of repairing in cases where the car is not written off and millions of pounds worth of third party damage you could do. I guess it depends how much your normal motor insurance costs, it doesn't seem to be risk priced so I suppose it looks like better value to someone who pays thousands a year for their main policy than someone who pays a few hundred - especially if buying something that will depreciate like falling rocks.
I always thought that the point of insurance was to put you back in the same position, ie if your 6-month old car was written off you would be paid enough to buy another 6-month old car and not a new one.
However when I looked at a new Vauxhall a few years ago, it appeared that the GAP insurance that I was offered was to cover the fact that the car would be depreciating faster than I could pay it off
So , like a Sun reporter, I made my excuses and left 
However when I looked at a new Vauxhall a few years ago, it appeared that the GAP insurance that I was offered was to cover the fact that the car would be depreciating faster than I could pay it off
So , like a Sun reporter, I made my excuses and left Justin Case said:
I always thought that the point of insurance was to put you back in the same position, ie if your 6-month old car was written off you would be paid enough to buy another 6-month old car and not a new one.
However when I looked at a new Vauxhall a few years ago, it appeared that the GAP insurance that I was offered was to cover the fact that the car would be depreciating faster than I could pay it off So , like a Sun reporter, I made my excuses and left
There are three sorts of gap insurance. At the lowest level you are insuring that if you write it off they will give you the difference between the amount of any outstanding finance and the insurance payout, if there is a negative difference. The middle level is that they will give you the difference between the amount you paid for the car and the amount you get from insurance. The top level is that they will give you the difference between what the car (or equivalent) would cost to buy today and the amount you get from insurance.However when I looked at a new Vauxhall a few years ago, it appeared that the GAP insurance that I was offered was to cover the fact that the car would be depreciating faster than I could pay it off
So , like a Sun reporter, I made my excuses and left swerni said:
For £80, it's an absolute no brainier
Depending on what it is, if it's to insure the difference between the insurance payout and the value of your finance then there is no point if you don't have much finance on it.Even at £80 the insurance company is not expecting to have to pay that much out on average, otherwise they wouldn't be doing it.
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