Gap insurance - worth getting?

[psychocandy]

Kinda, but some insurance is providing more valuable cover than others.... if your house burns down and you don't have insurance cover, that is a catastrophic financial (and indeed emotional) event that you would probably never fully recover from. It also provides cover for a range of scenarios - e.g.: if the house gets damaged, totally destroyed by fire, flooded, subsidence etc.

GAP is for a very specific event, and protecting for a relatively small loss, so I see it as providing only very limited cover... i.e.: Total Loss AND your fault AND you survive the accident AND you are still in a negative equity position AND you are ineligible for a brand new car. The loss ratios for GAP are incredibly appealing for an insurance company - far more so than motor insurance, home insurance etc.

Yeh I see what you mean. BUT its not expensive....

Im sure for most of us who are not on the "bones of our arse" as the saying goes, there is a figure worth paying, even if strictly speaking unnecessary, if the only benefit is to save time and hassle.

£120 or so is not many hours having to chase, phone people, fanny around....

[psychocandy]

Can't argue with that, and I can see how the loss ratios can be made to make GAP insurance attractive. However, considering your earlier argument that many insurance companies will offer new vehicle replacement in the 1st 12 months of a comprehensive insurance policy, and GAP specific states that it will cover you for any financial difference between what the car insurance Co gives you and what you owe the finance co. Is this not a case of miss selling of insurance, particularly in the 1st year of ownership of a new vehicle. Is this the next Miss Selling scandal?

Seems to be. BUT isn't it up to individual to check their standard policy to see if they have new vehicle replacement?

Its like saying an insurer shouldn't sell you buildings insurance because you bought a combined policy the week before and didnt check.

In my instance here, its lease so not so clear...

[Yorkie62]

Seems to be. BUT isn't it up to individual to check their standard policy to see if they have new vehicle replacement?

Its like saying an insurer shouldn't sell you buildings insurance because you bought a combined policy the week before and didnt check.

In my instance here, its lease so not so clear...

Isn't the onus on any financial institution to do a needs assessment these days? This is supposed to check that what they are selling you is what you actually need. That can only have been done if the purchasers insurance policy has been reviewed in the light of the cover being offered by the GAP Insurance product. I may be wrong but this seems like common sense to me, but hey when did that mean anything.

It's good having these reasonable discussions, you actually learn things rather then just shouting and verbally abusing each other.

[fiisch]

Ah, admittedly did not consider the theft angle (which perhaps I should have considering I currently live in Crawley, where cars quite often get pinched!).

I don't think insurance companies have an obligation to check if a product is suitable - if you buy two car insurance policies, for example, they don't check on MID to confirm the car is not insured elsewhere. (Although if you made a claim it would be different, and you'd probably have the latter policy declared void and your premiums refunded).

In the case of GAP, even if you're getting new for old replacement, it is still providing different cover - it'll make up the shortfall in Y2 (and probably Y3 depending on the finance deal if required) - so there's an argument to say new-for-old + GAP complement each other.

My approach isn't for everyone - I am very risk tolerant. My life insurance wouldn't get close to paying off my mortgage, and I don't have any other insurances except motor, home, contents and travel, but I contribute allowances into S&S ISA as a sort of self-insurance... Working in insurance for the last 11 years has made me very sceptical. I insure for the big crises, and obviously where you're obligated to, but happy to take on a bit of a risk for increased savings.

[psychocandy]

Yeh can get for £135. Lease company quoted £299. Nice little extra earner for them I guess.

[Platypus]

Yeh can get for £135. Lease company quoted £299. Nice little extra earner for them I guess.

Who did you use? I also need GAP insurance now.

[northernladuk]

Who did you use? I also need GAP insurance now.

Brave!

[jamesbrown]

Brave!

It'll be the first entry on his ignore list.

[Yorkie62]

Who did you use? I also need GAP insurance now.

Why not get your car insurance provider to provide it. NFU new car cover has a new replacement for the 1st 2 years. Saved me £499 that the dealer wanted.

Brain the size of a planet and I still have to communicate with morons

[GhostofTarbera]

Why not get your car insurance provider to provide it. NFU new car cover has a new replacement for the 1st 2 years. Saved me £499 that the dealer wanted.

Brain the size of a planet and I still have to communicate with morons

Or just don’t crash your car - job done


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