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Is GAP insurance worth it?

Discussion in 'Motors' started by SlyReaper, Apr 26, 2015.

  1. SlyReaper

    Soldato

    Joined: Apr 26, 2008

    Posts: 5,904

    Location: Bristol, Old Blighty

    So, I'm buying a new car, agreed price of £34,500. The dealer is offering something called GAP insurance for £465, which will last 4 years. If the car is written off in that 4 year span, then they will top up my insurance payout such that the total is what I originally paid.

    Good idea? I'm leaning towards getting it, but since I didn't have to decide immediately, I said I'd take advice.
     
    Last edited: Apr 26, 2015
  2. [TW]Fox

    Man of Honour

    Joined: Oct 17, 2002

    Posts: 150,955

    How about we start this thread again but use actual pounds rather than 'spacebucks' because it's worthyness depends on a few things chief of which being the actual price paid for the car, the other being what the car is and what its likely depreciation might be and how its funded.

    FWIW, it's NEVER worth buying from the dealer as the same product can be had online for about 100 quid.
     
  3. SlyReaper

    Soldato

    Joined: Apr 26, 2008

    Posts: 5,904

    Location: Bristol, Old Blighty

    I could call them squidaroonies instead? OK, I'll edit my post.
     
  4. [TW]Fox

    Man of Honour

    Joined: Oct 17, 2002

    Posts: 150,955

  5. SlyReaper

    Soldato

    Joined: Apr 26, 2008

    Posts: 5,904

    Location: Bristol, Old Blighty

    I just checked click4gap. Their quotes aren't great. £393 for 3 years cover and a £15k claim limit (which is what I expect my depreciation to be over that period). Given that, £465 from the dealer for a 4 year period seems more attractive.
     
  6. thewanted

    Mobster

    Joined: Jul 27, 2007

    Posts: 3,909

    Make sure you understand the difference between "Return to Invoice" and "Vehicle Replacement" GAP policies. This is all clearly explained on www.ala.co.uk (use "GAP12" for a 10% discount).
     
  7. [TW]Fox

    Man of Honour

    Joined: Oct 17, 2002

    Posts: 150,955

    It was just an example off the top of my head. The point is there are many firms who will offer this.

    For example:

    http://www.ala.co.uk

    Back to Invoice Plus

    4 years, £15k cover, £225 - half the dealer price.

    The dealer price is a con designed to make them tasty margin.
     
  8. paradigm

    Caporegime

    Joined: Aug 26, 2003

    Posts: 33,092

    Location: Staffordshire

    Mine is with ala, back to invoice plus.

    I'll be going with ala again when I order the s3 (or possibly s4)
     
  9. [TW]Fox

    Man of Honour

    Joined: Oct 17, 2002

    Posts: 150,955

    Is that because you found it so useful on the A4? ;)

    This is of course the issue with this product - the prices are VERY reasonable but there is a reason why - almost nobody ever claims. The chances of writing off a vehicle with a significant value are almost nil, you need to be involved in a very serious accident or have it outright stolen for it to be more cost effective to write the car off.

    This is why it's cheap, the risk to the insurer is very low. The policy price:payout ratio tells you what you need to know about the chance of it ever being used.
     
  10. SlyReaper

    Soldato

    Joined: Apr 26, 2008

    Posts: 5,904

    Location: Bristol, Old Blighty

    Thanks for pointing me towards ALA, they're giving much better quotes. I wonder if my dealer will match that quote? Given it's less than half the price, I suspect not, and I'll get the ALA insurance.
     
  11. paradigm

    Caporegime

    Joined: Aug 26, 2003

    Posts: 33,092

    Location: Staffordshire

    Quite. But it would be Sod's law that if I didn't have cover I'd need it. For the cost, I'd rather throw away ALA money than dealer prices!
     
  12. [TW]Fox

    Man of Honour

    Joined: Oct 17, 2002

    Posts: 150,955

    Nobody 'needs' it, it's strictly a bonus. Insurance will pay the replacement value of the car (after 2 weeks of arguing obviously) and you can buy a 2 year old S3 for the payout in 2 years time. It's not as if not having it leaves you destitute in the event of a crash.

    The only GAP thats essential is the original gap - the one that pays the difference between what your nearly new Astra is worth (£500) and what you still owe on the finance (£billions) because not having it means you are screwed in the event of a writeoff :D

    But of course I'm now duty bound to argue its pointless, I figured I might as well buy it for the F10, then I forgot too :D

    But its basically just gambling - you pay £250 and hope your car gets written off 2 years down the line and you get a bononza payout far in excess of its value.
     
  13. SlyReaper

    Soldato

    Joined: Apr 26, 2008

    Posts: 5,904

    Location: Bristol, Old Blighty

    I'm actually going to be paying for mine outright. No loans. Is it still worth getting? I mean, if my 2 year old S3 got trashed because some idiot drove into the side of me, I'd rather replace it with a brand new one than another 2 year old S3 where I have no particularly clear idea of the car's history.
     
  14. [TW]Fox

    Man of Honour

    Joined: Oct 17, 2002

    Posts: 150,955

    The overwhelmingly likely outcome of some idiot driving into the side of your S3 is that you spend 3 weeks without your S3 in somebody elses S3 whilst your S3 is fixed at the cost of his insurer.

    There is a very, very small chance that your car will be written off whilst you own it. Only if this very small chance comes to fruition will you benefit from GAP cover.

    Only you know if a slim chance of a payout is worth £225.
     
  15. Jono8

    Capodecina

    Joined: May 20, 2007

    Posts: 24,429

    Location: Surrey

    I am also debating whether to get gap or not on my new Fiesta ST. Will only cost £85 for 4 years return to invoice cover (3 years but you can defer till after year 1 as my insurance will replace with a brand new car in the first year so 4 years effectively).

    For £85 it isnt a lot of money but at the same time, it is just betting on your car being written off. I would probably be better off just taking the £85 to a casino.
     
  16. InQ

    Wise Guy

    Joined: Oct 21, 2003

    Posts: 1,629

    Location: Preston

    Or stolen.
    I know a few people who have had cars nicked (keys taken from the house) and they have obviously benefited from GAP. There is quite a few reports of Golf R's being nicked so S3's would also be favourable as well.
    Wife has her Fiesta ST on lease and for that its a must have as you are liable for the payments you havent yet paid as well.
    Thinking of getting it for my new M135i, gapinsurance123.co.uk were cheapest on the Fiesta and seem the cheapest on the M135i (return to invoice). I'd go for 3yr / £10k or 4yr / £15k.
     
  17. [TW]Fox

    Man of Honour

    Joined: Oct 17, 2002

    Posts: 150,955

    Stolen = written off.
     
  18. Chris344

    Wise Guy

    Joined: Oct 2, 2006

    Posts: 1,154

    www.ala.co.uk are very good and much cheaper than dealer GAP polices...
     
  19. thewanted

    Mobster

    Joined: Jul 27, 2007

    Posts: 3,909

    I hope the OP checks them out now that they've been mentioned 4 times in this thread ;)
     
  20. Chris344

    Wise Guy

    Joined: Oct 2, 2006

    Posts: 1,154

    Well when I bought my car, the dealer wanted £500 for GAP, now they can throw this in for free depending on how much room they have.

    ALA cost me £180 (and they are on Topcashback) for a better policy and they have great reviews in the industry.
     


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