My Citigo Monte Carlo should be delivered next month, I stumbled across a thread on GAP insurance and thought this is something I should look into. I'm interested in a new replacement insurance, as the thought of having to replace a new car with a second hand one due to it being written off isn't very appealing. Is there such an insurance policy on offer. Car with options is ~£11k.

 

Cheers

 

MIke

Hi Mike,

 

So, assuming the car is brand new and you are to be the very first registered keeper, you can indeed get the type of GAP insurance that you describe.  It's called Replacement GAP insurance.

 

• You can read more about it here.
• You can view our policy terms and conditions here.

 

In a nutshell though... if you bought your car brand new and took out Replacement GAP insurance, in the event of that vehicle being declared a Total Loss (written off) within the policy duration, the policy will pay the difference between your Motor Insurance payout and what it would cost at the time of claim to replace the vehicle with a brand new version of the same (or nearest equivalent) vehicle at that time - even if the replacement vehicle costs more than you bought the car for first time around.  

 

In the event that you'd financed the car and there was an outstanding balance due to the finance company at the time of loss, you'd clearly then use the combined sum of your Car and GAP insurance payouts to clear some or all of the remaining finance and any surplus funds would then be yours to use against the cost of any vehicle from any dealership of your choice.

 

Of course, if you had not financed the car (or you had cleared the finance by the time of loss) all of the funds would be yours to use against the cost of your next car.

 

You don't mention what duration policy you'd require nor whether the ~£11k is the price after any discount, but based on a vehicle purchase price of £11k as an indication of cost, we could provide you with a 3yr policy incorporating a £10k Claim Limit for a one-off all-inclusive fee of £99.66 and as a BRISKODA forum member you'd get a further 10% discount bringing it down to £89.69. (Other durations and Claim Limits are available).

 

Note that in some cases, it's possible that your Motor Insurance policy may cover you on a New-For-Old basis in the first year already.  If it's a decent cover level (the quality of New-For-Old schemes vary considerably from one insurer to another) it could mean that you don't actually require GAP Insurance in the first year.  In which case, you'd still need to buy GAP insurance within 6-months of taking ownership of the vehicle, but, when you bought it you could specify when you wanted the policy to start and you could choose a start date up to 12 months ahead of when the vehicle was first registered - thereby avoiding duplicate cover in the first year but still benefiting from GAP insurance in the latter years.  What's more is that this is a no-cost option, in which case you end up with a 3yr policy covering you for years 2, 3, 4 (without the additional expense of paying for a 4-year policy) or you could save a little money upfront by buying a 2-year policy that ends up covering years 2 and 3 only.

 

However, some New-For-Old schemes are, frankly, rubbish (the criteria you're required to meet in order to qualify for a new car replacement being so difficult to meet that the policy may as well not have New-For-Old cover), so it's clearly important to check out your Motor Insurance policy in detail and verify whether or not it would be prudent to have GAP insurance in the first year or not.

 

Please see this article here, for guidance on what to look for.

 

If I can be of any further assistance, please don't hesitate to ask

 

Best wishes

 

David

Many dealers will try and get you to sign up for this and 'lifeshine' paint protection as they make a tidy profit on both, so if you do intend getting it you will get it cheaper by shopping around and cutting out the middle man dealer. Its also worth checking your insurance policy as most insurers will replace you car with a new one if its written off in the first year. Do you or the nominated drivers have a history of writing off cars, if not is this something you actually need? As an alternative you could enrole on a skills for life course with the IAM for £140 or an equivelent with ROSPA etc. and become an advanced driver (assuming you're not one already) and reduce the chances of being involved in any accident, let alone one which writes your car off. Food for thought?

Many dealers will try and get you to sign up for this and 'lifeshine' paint protection as they make a tidy profit on both, so if you do intend getting it you will get it cheaper by shopping around and cutting out the middle man dealer.

 

Dealer's make a HUGE amount of profit on GAP insurance alone.  The FCA's Market Study in March 2013 stated that they were overcharging UK consumers by circa £76m per year in the process!

 

Its also worth checking your insurance policy as most insurers will replace you car with a new one if its written off in the first year.

But as I said above, don't bank on it.  Some New-For-Old schemes from Motor Insurer's are really poor.  It will pay to carefully check the terms of your Motor Insurance policy and you should read this for guidance.

 

In any case, if you are inclined to buy GAP insurance, you should NOT rely on the New-For-Old cover in the first year and delay buying GAP insurance until the end of year one.  This is because if you wait more than 6-months from taking ownership of the vehicle to buy GAP Insurance the cover-level you can get then is drastically reduced compared to the cover level you can buy within the first 6-months.

 

Do you or the nominated drivers have a history of writing off cars, if not is this something you actually need? As an alternative you could enrole on a skills for life course with the IAM for £140 or an equivelent with ROSPA etc. and become an advanced driver (assuming you're not one already) and reduce the chances of being involved in any accident, let alone one which writes your car off. Food for thought?

That's great in terms of increasing your own ability to avoid an accident, but is of limited use if someone else causes the accident or, if a thief decides to relieve you of your vehicle.  GAP Insurance is not just about accidents, it covers in the event of a Total Loss through accident, fire or theft.

Hi David that is perfect. The PCP is indeed 3 years. I will check with my insurance to see if I am already covered and get back to you, but that price seems good.

 

In response to the dealer trying to add lifeshine and GAP they did indeed try and sneak this into my order, he did mention it though so was not trying to trick me, I just asked for it to be removed from my order straight away.

 

I've always been wary of GAP and Payment Protection, hence why despite getting 10 calls a day I am not actually entitled to a PPI claim lol.

Hi,

Just to let you know that we offer a product called Total Loss Protection. Whilst it's not exactly the same as your traditional GAP insurance we feel it can offer a cost effective alternative. If anyone would like any further details then please feel free to drop me a line.

Regards

Dan.