Yes. It is best to check the policy wording for a detailed list but exclusions of this nature would be things such as VAT if you are VAT registered, delivery cost, first registration fee, extended warranty charges, insurance products, service plans, arrears negative equity, administration fees, fuel, road fund licence and dealer fitted options (although factory delivery and fitted options are covered).
No. You can still purchase the GAP insurance immediately using the original registration. Once your private plate is fitted to the vehicle please advise us of the new details and we will update your records free of charge.
GAP policies cannot be renewed or extended; therefore, it makes sense to effect a policy for the term of your agreement.
If, having purchased a policy, you subsequently cancel it mid-term before the policy expires (circumstances when the policy is transferable are contained in Can I change my vehicle and cover it with my existing GAP policy?) you will be provided with a monthly pro rata rebate of the original premium (subject to a £35 administration fee and whole unexpired months) which can be used in one of two ways:
1. It can be used by you as part of the premium for a new policy for your new vehicle, or
2. You can simply keep the rebate and use it as you wish.
Yes if Total Loss occurs outside the United Kingdom, the Channel Islands or the Isle of Man where the vehicle has been driven for not more than 30 days outside the United Kingdom, the Channel Islands or the Isle of Man in the 12 months immediately preceding the total loss.
The insurers are covered by the Financial Services Compensation Scheme (FSCS) established under the Financial Services and Markets Act 2000. You may be entitled to compensation of up to 90% of the cost of your claim in the unlikely event that the insurer cannot meet its obligations. Further information about compensation scheme arrangements is available at www.fscs.org.uk
Contract Hire and Lease agreements vary and things like maintenance charges may be included in your settlement figure from the finance company at the time of a total loss, but these would not be covered by your GAP policy. We recommend that you check your agreement for specific details.
Other costs which are not covered include:
Policies apply to a private individual or a sole trader who fulfils the eligibility requirements and whose name appears as the insured on the Policy Schedule, or
A partnership which, in the name of at least one partner, appears as the insured on the Policy Schedule, providing the partner is at least 18 years of age at the start date, and the partnership fulfils the eligibility requirements, or A limited company or other legal entity which fulfils the eligibility requirements and whose name appears as the insured on the Policy Schedule.
You may not require GAP Insurance because your vehicle may be fully protected with the insurance provided under the Motability scheme. Please check with the provider for confirmation.
In addition to the conditions mentioned in When can I buy a GAP Insurance policy? and the full list contained in the policy wording, a brief summary would be:
GAP claim settlement is always conditional on your main vehicle insurer settling your total loss claim.
You must have in place for your vehicle a fully comprehensive vehicle insurance policy, issued by an authorised UK vehicle insurer, and which is maintained in force in your name throughout the period for which you are insured under your GAP policy.
In addition, cover extends to all named drives on that policy provided they have your consent to drive and they hold a valid driving licence and are not in breach of the conditions of that driving licence.
No; there is no need for it to do so because it would be refundable pro-rata by the DVLA if your vehicle is written off. If your vehicle is declared a total loss by your insurer, you send section 9 of the vehicle logbook to the DVLA. You will then receive an automatic refund in the form of a cheque within 4 weeks.
Claims should be reported to the claims administrator as soon as possible but within 60 days of the incident giving rise to the claim.
You must contact the claims administrator before accepting a vehicle settlement from your main vehicle insurer or your GAP claim may be affected.
The full claims conditions can be found in the policy wording, but you will need to provide the following supporting documents:
Designed to cover the ‘gap’ between the Current Value of the Insured Vehicle and the Finance Early Settlement Balance payable to the Finance Company at the date of Total Loss if the Insured Vehicle is declared a Total Loss within the Period of Cover. The policy runs for a term of 60 months and includes a maximum contribution of £250 to the excess on the main motor insurance policy.
For 0 to 48 month period, this policy provides the difference between the settlement from your motor insurance or Glass’s valuation whichever is greater and the purchase price of the vehicle; or if the early settlement figure is greater on your finance agreement; however, for 49 to 60 month period, it provides the difference between the settlement from your motor insurance and the early settlement figure of your finance agreement (this is because all of our policies cover finance agreements up to 60 months). The policy also provides a motor insurance policy excess contribution up to £250.
Contract Hire and Leasing GAP:
This product is suitable for customers who are renting or have a contract hire agreement on the vehicle. In the event of a total loss it will protect against the outstanding hire/lease agreement settlement up to the chosen benefit limit. The policy runs for a term of 60 months but will end if the Hire agreement ends sooner. You have the option to also cover advance rentals or lease deposit up to a maximum of £3000. The policy also provides an excess contribution up to £250.00
All of the above types are available but different specifications/qualifications apply. The following represent brief summary answers; therefore, you should check the relevant Insurance Policy Information Document (IPID) and policy wording thoroughly, to ensure that you select the correct policy for your needs
Yes. Where you have a motor traders insurance policy, and have not purchased the vehicle at trade value, Glass’s Guide will be used to calculate the value of your vehicle at the time of the loss and will use this to determine the value of the claim to be paid.
In addition to the conditions mentioned in When can I buy a GAP Insurance policy? and the full list contained in the policy wording, a brief summary would be:
GAP Insurance is designed to protect you against financial loss if your vehicle has been declared a total loss or write off by your main vehicle insurer; however, the maximum amount paid out is restricted to the claim limit chosen by you, which is shown in your policy schedule.
It is available for personal or business cars, motorhomes and tourers, and small vans not exceeding a Gross Vehicle Weight of 3,500kg.
If your vehicle is deemed a total loss by your main vehicle insurer, it will only pay you market value for your vehicle at the time of the incident, which considers age, mileage and general condition e.g. a new car’s value after 2 years may only be 65% of its original value, which means that you may not be in a position to purchase an equivalent replacement vehicle. It is also important to note that the outstanding contract hire, lease or finance amount owed could exceed this figure, meaning that you may still have an uninsured liability that you still owe.
Total Loss for Contract Hire/Lease Finance GAP covered by these FAQs occurs when your main vehicle insurer has declared your vehicle beyond economic repair and made settlement following fire, theft, or damage sustained as a result of an accident, malicious damage or flood occurring after the start date and before the end date of your GAP policy. The policy covers the difference between your insurance settlement at the point your vehicle is written off or declared a total loss and the amount outstanding on your contract hire, lease or finance agreement (restricted to the benefit cover level selected by you and shown on your policy schedule).
In all cases, the maximum amount paid is restricted to the claim limit you choose and is shown in your Policy Schedule.
Cover will also include up to a maximum of £250 of your main vehicle insurance excess.
This policy is, therefore, suitable if you have taken your vehicle on contract hire, lease or purchased it using any of the standard financing agreements.
You are able to select both the term of your policy to match your agreement term and the maximum amount of benefit that you would like to cover for in the event of a total loss.
The following questions and answers (which you should read) represent brief summaries; therefore, you should also check the policy wording thoroughly, to ensure that the policy suits your needs.
The policy exclusions around negligence are clear. The policy will not pay out if the total loss was caused by a theft when your vehicle was left unoccupied (that is, nobody is inside it) and was left unlocked, with the windows or roof open or with the keys inside or on it.
All named drivers on your main comprehensive motor insurance policy; however, GAP claim settlement is always conditional on your main motor insurer settling your total loss claim.
Anyone driving your vehicle under their own motor insurance or on a temporary/short term motor insurance policy will not be covered
Average figures suggest that a 2-year-old car would be worth about 65% of its original value, a 3-year-old vehicle 45% - 50% and for 4 years its value could drop to 35%-45%.
However, this is not an exact science because rates can be affected by such things as make/class of vehicle, mileage, condition, and general marketability at the time of a total loss.
Also, lease and contract hire companies vary greatly on their policy reclaims with regard to a total loss; therefore, you should check your agreement in order to determine a realistic level of cover.
GAP policies cannot be renewed or extended yearly or at the end of the policy; therefore, it makes sense to effect a policy for as long as you plan to keep your car. The Finance GAP and Contract Hire & Leasing policies automatically run for 60 months.
If, having purchased a policy, and then subsequently change your car before the policy expires, we will provide you with a daily pro rata rebate of the original premium (subject to a £35 administration fee) which can be used in one of two ways:
You may purchase a policy provided you do so within 185 days of purchasing your vehicle from a VAT registered dealer, that it is less than 10 years old at the time of purchase and the vehicle has done less than 100,000 miles.
All of the options are shown when you obtain a quote.
No, because in the event of a total loss, your main vehicle insurer will pay a settlement of market value and the GAP insurance is designed to “top-up” their settlement. Your GAP policy should only be required to match the difference between your insurer’s settlement and the outstanding finance balance on your financing agreement.
You may purchase a policy provided you do so within 180 days of “purchasing” your vehicle, provided that, at the time of “purchase”, it is less than 8 years old, has completed less than 80,000 miles, its value is no greater than £150,000 and it has been “purchased” from a VAT registered dealership or internet broker.
Yes, you must be at least 18 years of age.
No; but to be clear, negative equity in this context means a finance balance for a previous car which has then been added to a new finance agreement for a new car. Only finance relating to the new car is covered.
Yes; the policy wording explains in detail all exclusions; however, the most common reasons a GAP policy will not pay out are:
Either by one payment via bank debit or credit card or by 12 equal monthly instalments of a finance agreement with an interest rate of 11.5% (24.85% APR). Comprehensive details of the finance agreement are provided before you agree to it. .
These amounts include Insurance Premium Tax (IPT) which is a government introduced tax on insurance policies including car, home, travel, and pet insurance which every insurance provider has to charge and pass on to the Inland Revenue. .
Yes and no, in that delivery and factory fitted options are covered but dealer fitted options are not. Other exclusions would be things such as, insurance premiums, road tax, warranties.
It would be wise to consider the possibility that there may be instances where your insurer reduces your settlement to market value only. This can be for a variety of reasons, which include things like exceeding the annual mileage limit pro rata, adverse condition of the vehicle, because the vehicle has been stolen rather than being involved in an accident or if a replacement vehicle cannot be sourced within a certain number of weeks of the incident. In addition, it should be noted that you won’t be able to effect a GAP policy after 180 days have passed since you “purchased” your vehicle. If you do not have GAP insurance, you could be left with a shortfall.
GAP Insurance is designed to protect you against financial loss if your vehicle has been declared a total loss or write off by your main motor insurer.
It is available for cars, motorcycles, taxis (including black cabs), including small vans and motorhomes not exceeding a Gross Vehicle Weight of 3,500kg.
If your vehicle is deemed a total loss by your main motor insurer (typically because of an accident or theft), it will only pay you market value for your vehicle at the time of the incident e.g. a car’s value, 2 years after purchase, may only be 65% of its original value; however, the outstanding finance owed is likely to exceed this figure, meaning that you still have an uninsured labiality and no vehicle. Various types of GAP insurance have been developed to protect vehicle owners from losses incurred as a result of a total loss.
We rely on your main motor insurer to settle a claim and, as long as they do, so do we. For example, your insurer may not settle or may significantly reduce your settlement if your vehicle is stolen with the keys left inside because they may conclude that it is negligence e.g. if the keys are left inside whilst de-icing or paying for fuel. If this is the case, your GAP insurance cannot settle.
If your keys are stolen from your house or bag, your insurer would most probably settle your claim, in which case, so would your GAP insurance.
Not all comprehensive vehicle insurance policies provide cover if insured vehicles are hit by an uninsured driver, so it is best to check your main policy.
GAP insurance is conditional on your main vehicle insurer settling your claim in the event that the vehicle is written-off. Provided they do, and you follow the claims procedure, then the GAP insurer will also make a settlement.
Your policy is transferable in the following circumstances:
Not all comprehensive insurance policies provide cover if insured vehicles are hit by an uninsured driver, so it is best to check your policy.
Our GAP insurance is conditional on your main motor insurer settling your claim in the event that the vehicle is written-off. Provided they do, and you follow our claims procedure, then we will also make a settlement.
In 2019, UK Government statistics show the following numbers of reported road traffic accidents:
The level of cover or claim benefit is selected by you and set on your GAP policy at the time of purchase and is the maximum amount that will be paid in the event of a claim. You will also need to choose the period you wish cover to last.
The estimated list price of the vehicle and you will need to select the term of cover you wish to take.