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Vehicle GAP Insurance

Vehicle GAP insurance, or Guaranteed Asset Protection insurance, is stop-gap cover that provides you with financial protection if your vehicle is written off. Your motor insurer may not pay you enough either to settle any outstanding finance or the cost of buying a replacement. To ensure that you’re not left out of pocket and without a new set of wheels, GAP Insurance coverage picks up the shortfall between your insurance payout and the amount outstanding on the finance agreement.

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It's not essential, but it's well worth considering and can be a real financial lifesaver should the worst happen.


What is vehicle GAP insurance?

GAP insurance coverage is a ‘fill-in’ between the amount your insurance provider pays out if your car is stolen or written off, covering the difference between the price you paid for your vehicle and its current market value. If you have a high-ticket car, such as a performance or sports car, that gap can be considerable. And if you’re still paying finance on it, the shortfall between the amount you owe and the amount your insurance provider pays out can leave you badly out of pocket.

How does car GAP insurance work?

While comprehensive motor insurance does provide a payout if your vehicle is written off, it typically only covers the car’s current market value — not what you originally paid or still owe. If your vehicle is written off, your motor insurer will only pay the current market value for your vehicle. That means there is a financial gap that you will have to pay out of your own pocket. Vehicle GAP insurance coverage fills in the discrepancy between the two, ensuring you’re not left out of pocket if your car is stolen and written off.


The benefits of having GAP cover

GAP cover is entirely optional, but for a small extra premium on your annual motor insurance costs, you can ensure you have complete peace of mind and financial protection.

Types of GAP insurance policies

There are several different types of policies:

  • Finance cover – if you’ve taken out car finance and your car is then written off, leaving you owing money to the finance company, this will cover any outstanding repayments.
  • Return-to-invoice – this pays you the difference between your car insurance payout and the price you paid for your car, as on your invoice.
  • Return-to-value – this covers the difference between your insurance payout and the car’s value when new.
  • Vehicle replacement – this policy option matches the new price of an exact like-for-like replacement (the same spec and model of your insured car), even if the price has risen.
  • Negative equity cover – if your car's value is less than the loan you took out to pay for the vehicle initially, this provides some financial cushion.

What it doesn't cover

  • There are certain provisos to GAP insurance cover that you need to consider before you invest in a policy:
  • You must have comprehensive car insurance – you won’t be able to get car GAP cover if you only have third-party or third-party, fire and theft.
  • If your vehicle is written off due to your own illegal actions (such as driving under the influence of drink or drugs, or without a valid licence), you won’t receive any GAP payout.
  • Older cars, high-mileage cars, or high-value vehicles may not be covered.
  • You’ll only be paid if your vehicle is stolen or deemed a ‘total loss’ by your insurance provider.
  • It does not cover cars used for hire or reward, such as taxis or courier vehicles, or for other business purposes.
  • Insurance providers typically only cover cars listed in the industry-standard Glass’s Guide valuation service.

How much does it cost?

Vehicle GAP insurance doesn't cost the earth, but its value is peace of mind and financial security if the worst happens. At Park Insurance, we'll never try to sell you insurance you don't need or want, and our advisors will work hard to find you the best and most affordable GAP insurance quote that suits your needs and budget.

Am I eligible for vehicle GAP insurance?

Specific criteria enable you to add GAP cover to your portfolio, including a vehicle that’s less than eight years old, has less than 70,000 miles on the clock, and is covered by fully comprehensive insurance. Your broker will be able to talk you through the eligibility requirements.

What's the difference between GAP insurance cover and standard car insurance?

Standard car insurance only pays out the current market value of your vehicle. In contrast, GAP covers the financial shortfall between your car’s value at the time of loss and what you originally paid or still owe on any finance agreement.

Stay on the road with Park

For over 30 years, Park Insurance has been the go-to team for specialist insurance of all kinds. Our position as preferred brokers to some of the UK's largest insurance providers means we can utilise our skills, connections, and expertise to find the best GAP insurance quotes for you. Contact our team today, or use our Get A Quote button for an instant, no-obligation quote right now.

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Park Insurance Services Ltd
323 Church Road
St George
Bristol
BS5 8AA

Tel: 0117 955 6835

Email: info@parkinsurance.co.uk

Park Insurance Services Limited is authorised and regulated by the Financial Conduct Authority under FRN 998383. You may check this on the Financial Services Register by visiting the FCA website. Park Insurance Services Limited is registered in England and Wales (company number 13091532). Registered address: 323 Church Road, St. George, Bristol, England, BS5 8AA.