Gap insurance explained

[admin]

GAP coverage or GAP insurance, was established in the early 1980's to provide protection to consumers based upon buying and market trends.

Due to the sharp decline in value immediately following purchase, there is generally a period in which the amount owed on the car loan exceeds the value of the vehicle, which is called "upside-down" or negative equity. Thus, if the vehicle is totalled at this point, the owner will still owe money on the loan. The escalating price of cars, longer-term auto loans, and the increasing popularity of leasing gave birth to GAP protection. GAP waivers provide protection for consumers when a "gap" exists between the actual value of their vehicle and the amount of money owed to the bank or leasing company.

[justf1]

I came across this insurance when my dealer tried to sell me it. He wanted nearly £400 for a return to Invoice Policy.
I went on-line and then called www.Click4gap.co.uk who were so helpful and explained the differences clearly between 3 different policies. Apparently you can take out Gap Insurance on any car upto 7 years old and 80,000 miles... effectively freezing the value of the car!

As I had bought the car within the last 3 months (apparently the car does not have to be new), I was entitled to RTI Gap. My car cost me £15,000 and was new last summer. According to WhatCar depreciation guide (http://www.whatcar.co.uk/depreciation-index.aspx) the forecast market value in 3 years time was a little over £6,000. (the price my insurers would pay out on in the event of Theft or declared a "total loss" though an accident).

I took a 3 year policy with click4gap.co.uk with a £10,000 claim limit and saved over £220.
I have contacted them since with a few questions, and being owned by the underwriters they have been quick and accurate in their response.
Anyone thinking of protecting their investment in their car really should give them a call (020 8543 6014) or visit their website www.click4gap.co.uk

Does anyone know where I can buy a good used car warranty. My wife has a 3 year old Focus and its just about to come out of its Manufacturers warranty.

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