What is GAP Insurance?

Guaranteed Asset Protection (GAP) Insurance provides protection against financial loss if your vehicle is declared a total loss or written off by your car insurance company.

Do I need GAP Insurance?

If your car is involved in an accident, stolen, or damaged, and is considered a total loss, your insurer will typically only pay out the market value for your vehicle at the time of the incident. However, as cars can depreciate rapidly, losing approximately  , you may face a significant shortfall in the remaining finance settlement charges or suffer a substantial loss due to depreciation in vehicle value.

To avoid this, protecting your vehicle with GAP Insurance from MotorEasy helps to bridge the gap between the amount your insurer will pay you for your vehicle and the price you paid for it or owe in finance, depending on the type of GAP Insurance you choose.

MotorEasy's GAP Insurance serves as a financial protection in the event of a write off. In such situations, your regular car insurance policy typically covers the current market value of your vehicle, which may be lower than the purchase price of your car/the amount you still owe on a finance agreement. This difference between your insurance payout and the original purchase price/outstanding finance amount represents a financial gap. MotorEasy's GAP Insurance is designed to fill or "bridge" this gap. It provides you with additional coverage so that you won't have to pay the remaining amount out of your pocket if the insurance payout is insufficient to cover your outstanding financial obligations/the cost of replacing your vehicle.

 

GAP Insurance FAQs

What cars are eligible for GAP insurance?

To be eligible for GAP Insurance, vehicles must meet certain criteria. These include being less than 10 years old and having less than 100,000 miles recorded since their initial purchase. Additionally, cars and light commercial vans weighing less than 3,500 kg, with an insured value of under £75,000, are also eligible.

The vehicle must also:

  • be listed in Glass's Guide,
  • adhere to UK specifications,
  • and should not have undergone any modifications.

How does GAP insurance work?

The specifics of your GAP Insurance policy will depend on the type of coverage you select but all policies work in a similar way; by closing the gap between the value your insurer pays out in the event of a write-off or total loss and the original value of your vehicle.

For example, if you purchase a new car for £30,000 and it is stolen or written off a few years later, and its value has declined to roughly £10,000,your insurance company will only pay out the vehicle’s current value.

If you’re still paying off finance or a leasing company, or just want to buy the same car again, you’ll likely be out of pocket without GAP Insurance.

 

Is GAP insurance worth it?

It will completely depend on your personal circumstances as to whether you’ll benefit from GAP Insurance, however, it’s generally thought that you will benefit from coverage if you have a new or low-mileage vehicle, in the event of a write-off or total loss. This is because new vehicles depreciate in value quickly, typically around 60% in the first three years alone.

If you’re leasing or financing a vehicle, GAP Insurance can be beneficial as, in the event of a write-off, you’ll likely be left with expensive fees to pay as you will still be required to pay off your finance agreement, despite no longer having a car that is driveable.

It is important to note that depending on your insurance policy, may already have coverage for the , under a new for old clause for example. However, this is subject to your insurance provider and the type of coverage you have.

Before purchasing additional GAP Insurance, it is recommended that you verify your existing coverage and set a reminder to renew your policy before it expires.

 

How much does GAP insurance cost?

The cost of your GAP Insurance will be determined by various factors, such as the make and model of your vehicle, the duration of the coverage, and the level of protection you require. However, typical GAP Insurance policies usually cost between £100 to £300. Purchasing from a dealership may cost up to 75% more, so buying from MotorEasy will usually save you money.

* GAP – Dealer Price Comparison – carried out by Motor Easy in August 2023
(Mercedes a-class – HD21 FOT - Mercedes dealership price, 3 years cover - £359 – cover up to £50,000, 4 years cover - £449 – covered below £25000, £469 – covered above £25,000 - MotorEasy price - £198.84 – 3 years cover; BMW 1 SERIES – RJ70 NBM – 8,000 miles - BMW Dealership price: 3 years cover - £555 -MotorEasy Price: 3 years cover - £198.84)

 

Can I get GAP Insurance on a used car?

Yes, if you have purchased a used car within the last six months, you are eligible to purchase a MotorEasy GAP Insurance policy, providing that the car:

  • Is less than 10 years old
  • Has less than 100,000 miles recorded since the initial purchase
  • Has an insured value of under £75,000
  • Is listed in Glass's Guide
  • Adheres to UK specifications
  • Has not undergone any modifications.

 

I lease my car – can I still get GAP insurance?

Yes, GAP Insurance is available for new and used cars purchased in the last six months, whether bought outright, leased or on finance.

 

What does GAP insurance cover?

A GAP Insurance policy will vary depending on the type of cover you choose but will essentially cover the difference between how much your insurance pay out is in the event of a write-off or your car being considered a total loss, and the cost of replacing your vehicle or the amount remaining on your finance.

With MotorEasy, you’re also covered for optional extras and accessories if they’re installed by the factory or dealer as well as up to £1000 towards your insurance excess.