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Do you want to buy Gap Insurance?

Do you need assistance to understand how Gap cover could work for you? Are you looking for the best Gap Insurance quote? It's as easy as 1-2-3!

GAP Insurance is designed to 'bridge the gap' between your motor insurers settlement if your vehicle is stolen or written-off and, dependent on the type of cover, either the original price you paid for it, the replacement cost or the finance settlement.


What is Gap Insurance for a car, van, motorbike, LCV or motorhome?

Simply put, it covers the monetary difference between your motor insurers settlement, following a fire, theft or accident (fault or non-fault)
and, depending on the type of cover you have, either:

  • the outstanding finance settlement on HP, PCP or a lease (Finance and Contract Hire Gap)
  • the original invoice price paid (Combined Return to Invoice)
  • the cost of a replacement vehicle equivalent to your original vehicle the time you bought it. (Combined Vehicle Replacement)
  • the value of your vehicle when you purchased the policy (Agreed Value)
Which type of policy might be best, or may be available will depend on several factors that may include how and when you bought the vehicle and of course exactly what aspect of the potential depreciation of the vehicle. For a better idea, you can click for a quotation or simply call us on 0800 195 4926.

Gap Insurance is normally taken within a short period of buying a vehicle (180 days is typical) and is available from GapInsurance123 for cars, vans, LCV's, motorbikes, motorhomes, taxi's, couriers and driving schools.

It should also be noted that 'Gap Insurance' can be known by a number of different names. These may include Shortfall Insurance, Asset Protection Insurance, Guaranteed Asset Protection to name just a few.

Why buy Gap Insurance?What is Gap Insurance for a car?

There is a range of factors why vehicle owners may consider buying Gap Insurance. Not everyone may have the same motivation to take this type of protection but we have included a number of reasons why Gap cover is a popular choice for vehicle owners. These may include:
  • All vehicles will lose value (unless you are very lucky) from the time you purchase. The likes of the AA and What Car have suggested that new vehicles can lose between 50-60% of their value in the first three years of ownership.
  • Your motor insurance may only cover the 'market value' if the vehicle is declared a total loss following an accident, fire or theft
  • You may have taken a finance agreement for the vehicle, and your motor insurance settlement may not be sufficient to cover this
  • If you have paid 'cash' for the vehicle, then you could be faced with having to fund the financial loss due to depreciation when you replace the car/van/motorhome or motorbike from your funds. 
  • You can never predict if and when an incident that leads to your vehicle being 'written off.' However, the financial loss can be severe as your vehicle is probably the quickest depreciation asset you may ever own.

Essential requirements to make a claim

All insurance policies have terms and conditions. We would always recommend that you read any policy terms thoroughly and ask questions on anything you do not understand or need any clarification on. One ket area is the 'eligibility' section of cover and there can be several important factors that you may need to be aware of to ensure your Gap cover is valid. These may include:
  • your vehicle must be fully comprehensively insured (you can be covered Third Party, Fire, and Theft with GapInsurance123 but you may only make a claim under fire or theft circumstances
  • you must own the vehicle (except where it is under a contract hire style lease) and any finance linked to the vehicle must be in your name
  • your motor insurer must settle your total loss claim following the incident (you cannot claim on the Gap policy if the motor insurer does not cover the same event)
  • the vehicle must not have been subject to a 'total loss' claim previously

Key features from GapInsurance123

Not all policies will be the same, even when they bear the same title. Standard features offered by your motor dealer may not compare favorably with a GapInsurance123 policy. If you are looking to compare we have compiled a list of features you may want to chek against. Gap Insurance
  • 1-5 year cover periods available
  • Cover available for cars, motorhome, LCV's, motorbikes
  • Cover available for specialist uses such as driving schools, taxi's, chauffeur, courier and hire and reward
  • One single premium price to cover for the full term (not annually renewable)
  • Cover for all factory built options on your vehicle
  • Cover for a further £1500 additional dealer accessories including mudflaps, carpet mats, paint protection treatments
  • Cover included for up to £250 of your motor insurers excess deduction from their total loss settlement to you
  • The option to defer (should you have the feature of full new vehicle replacement with your own motor insurance), transfer (should you change your vehicle mid term and cancel with a pro rata refund if you sell the vehicle and do not replace it.

How to get a quotation

You will need to provide a number details to get a full quote. These may include

  1. the purchase value (if for a lease), the original purchase price (if for HP, PCP, outright purchase from  a motor dealer) or the Glass' Guide Retail Value for an Agreed Value policy
  2. The length of cover you may want (1-5 years)
  3. The maximum claim limit you may require
  4. How you are buying the vehicle, eg cash/outright, PCP Finance, Hire Purchase or Contract Hire Lease etc
  5. Whether you are using the vehicle for taxi, private hire, courier, chauffeur or driving school

How much should you pay for Gap Insurance?

Like any insurance, you are protecting a loss that is unlikely to happen. The incident rate of claim for Gap Insurance is relatively low but each claim can represent thousands of pounds worth of depreciation.

So accepting the claims can be large but the number of claims can be relatively low then it does beg the question "How much should you expect to pay for a policy?"

The truth is the premium prices can differ widely depending on where you are buying the cover from. When you buy a typical Return to Invoice Gap policy from a motor dealer then a three-year policy could be £300-£400. If you buy an equivalent policy from an independent provider such as GapInsurance123 then the premium could be as low as £67.

Example Gap Insurance premiums for a £20,000 vehicle *
  Finance & Contract Hire
Combined Return to Invoice
Combined Vehicle Replacement
3 year
(£10k claim limit)
(£10k claim limit)
(£10k claim limit)
4 year
(£10k claim limit)
(£15k claim limit)
(£15k claim limit)
5 year
(£10k claim limit)
(£15k claim limit)
(£15k claim limit)

*Examples premiums are for the full term quoted, inclusive of Insurance Premium Tax and based on typical vehicle use and claim limits suitable for cover and period take from GapInsurance123 on 2nd December 2016

You may ask why are motor dealers so much more expensive than independent providers for Gap Insurance? Well, there are a number of factors including higher rates of Insurance Premium Tax, less competitive supply rates from insurers and different commission structures but savings by using the likes of GapInsurance123 can be considerable.

How to make a claim

There are some details and documents you will need to make a claim

These may include:
  • Notification from your motor insurer that they are going to write off the vehicle and what they are going to offer you in a settlement. IMPORTANT Do not accept the motor insurers settlement before you speak to the claims team. By contacting us first, this can allow the two insurers to sort out the claims between them. Not allowing this may delay the settlement of your claim.
  • A copy of your finance agreement and current settlement (should there be one for the vehicle)
  • Proof of purchase for the original vehicle (e.g., the sales invoice and (again if there is one) finance agreement for the vehicle
  • Inform the Gap Insurance claims team as soon as possible. Again experience tells us that the sooner you get in touch to notify a claim then this allows the best possible opportunity for a swift processing of your claim


Gap Insurance 123

Finance / Contract hire Gap pays the difference between your motor insurer's settlement on the day it is written off and the outstanding finance settlement on a PCP or HP agreement or the lease settlement on a Contract Hire/Lease

You can click or call 0800 195 4926 for an instant no obligation finance Gap quotation. 

Our fully trained and qualified team will ask you about you and your vehicle and what you are going to use it for. Together we can build you quote.

Finance / Contract Hire Gap pays the difference between your vehicles valuation and your outstanding finance/ outstanding rentals leaving you with no liability to your old vehicle.

Remember that not all finance and contract hire gap policies are the same and we work really hard to be able to offer what we consider the most comprehensive and feature rich cover available in the UK today.

Our Finance Gap and Contract Hire Gap policies, unlike many others, also allow you to .

  • Cover cars, vans , motorhomes and motorbikes at no additional cost.
  • Cover all non-transferable warranties and Paint Protection.
  • Cover paint protection
  • Pay the first £250 towards your own motor insurance excess
  • You can cancel the policy with a full refund within 30 days, and a pro rata refund of unused premium at any other point.

Remember, if you are looking for simple to understand guaranteed asset protection, we are only ever a click or a call away so why not get a quotation and see how easy it is to buy gap cover from GapInsurance123 can be.

Combined RTI Gap Insurance covers the difference between your motor insurer's settlement, following a theft or 'write off' and the higher of either the outstanding finance settlement or the original Invoice price paid.

What is Return to Invoice?

Return to Invoice Gap (sometimes known as Combined Return to Invoice, RTI Gap, Back to Invoice Gap, Retail Purchase Price Gap or just plain Invoice Gap) is possibly the most common form of cover and also the type that a motor dealer would normally sell.

Very simply Return to Invoice is designed to cover the difference, following a 'total loss' or 'write off' following a fire, accident or theft between the motor insurer's settlement and the higher of:

  • the outstanding finance settlement for the vehicle (if there is one)
  • the original invoice price you paid for the vehicle
How RTI Gap Insurance works

An example of how RTI Gap works

Let's say you purchase a vehicle for £20,000 and take a 5-year finance agreement through the dealer. As part of that finance agreement, you take finance on £19,000 after paying a £1,000 deposit.

If your car was stolen at the end of year three then you could be in a position where your motor insurer values (and pays you a settlement) of £10,000 and you still owe £12,000 in finance.

So what would happen if you have Combined Return to Invoice Gap in this example?

The important figures would be:

The invoice price you originally paid : £20,000
The amount outstanding on finance : £12,000
The motor insurer's settlement : £10,000

With Combined Return to Invoice, you can claim the difference between the motor insurer's settlement (£10,000) and the higher of the outstanding finance settlement (£12,000) and the original invoice price you paid (at £20,000 then clearly the higher in this example)

So in the example above you would be paid £10,000 from the motor insurance, a further £10,000 from the RTI Gap Insurance to give you your original £20,000 back in full.

With £12,000 still outstanding on the finance agreement then this would mean after this figure is settled you would actually have £8,000 back to use as a deposit for your new vehicle.

Key features of Return to Invoice from GapInsurance123

There are a range of product features to benefit our policyholders, and these would include:

  • 1-5 year policy terms available
  • up to 180 days from vehicle purchase permitted for policy purchase
  • up to £250 of any motor insurer's excess deduction from their total loss settlement covered
  • up to £1500 of additional dealer accessories covered including paint protection treatment charges, mud flaps, carpet mats etc
  • cover for cars, motorbikes, motorhomes, LCV's
  • optional cover for specialist use including taxi, courier, driving school and hire and reward
  • ability to cancel (with a refund), transfer and defer policy cover as required

Key Eligibility requirements for Combined Return to Invoice Gap

As with any insurance, there will be terms and conditions, including a number of key eligibility requirements for RTI cover from GapInsurance123. These will include:

  • the vehicle must be no more than 10 years old when you buy the policy
  • the vehicle must have no more than 120,000 miles on the clock when you buy the policy
  • the vehicle must be purchased from a VAT registered motor dealership no more than 180 days ago
  • your motor insurer must pay out a market value settlement for the incident that has led to the vehicle being declared a total loss
  • you must own the vehicle, be insured fully comprehensively ( we can cover fire and theft claims if you are only covered third party, fire and theft)
  • the vehicle must not have been subject to a total loss claim previously nor must it have been in any incident that may lead it to become a total loss claim prior to you buying the policy

For more details on Combined Return to Invoice Gap please call us on 0800 195 4926 or click for a Quote.



Pays the difference between your vehicles insurers write off valuation and either the outstanding finance or the amount you would need to buy another vehicle the same age, mileage and specification as yours was on the day you bought it.

What is Vehicle Replacement Gap?

Combined Vehicle Replacement (sometimes known as Replacement Gap, VRI Gap or just Vehicle Replacement) is designed to cover the difference between your motor insurers 'market value' settlement, following a 'write off' from an accident, fire, theft etc, and the higher of either the outstanding finance settlement (if there is one) or the cost of the equivalent vehicle to the one you originally purchased but crucially on the day you purchased it.

Confused? You may not be alone. Vehicle Replacement Gap is probably the most comprehensive type of cover on the market today, but also the most confusing. The common query we get is just what is the 'equivalent vehicle'?

Well if the vehicle was brand new when you bought it, ie you are the first registered keeper, then the 'equivalent vehicle' would be another brand new example of the same model with the same specification (or nearest equivalent) to the one from your original vehicle.

If the vehicle was one-year-old with 10,000 miles on the clock when you bought it then it would be another one-year-old, 10,000-mile example at the time you make the claim.

The idea is that you are being put back in the same standard of vehicle as you had at the time you bought your first one.

Why is Vehicle Replacement different to Return to Invoice Gap?

Simply put the price you originally paid (the figure that a Return to Invoice would cover) may be far less than the price you would have to pay to replace with the equivalent standard of vehicle in the future. We can illustrate this better by showing you an example of how Vehicle Replacement Gap Insurance works:

How does VRI Gap Insurance work?

From the example, above you can see that three elements come into play when you are looking at protection from the Vehicle Replacement Gap. These will be the depreciation from the original invoice price paid, the market value of the vehicle as it ages and the cost of the replacement vehicle. 

Let's show you how this would work if you had to make a claim.

If you bought the vehicle brand new for £20,000 and then at the end of year 4 your vehicle was stolen, in our example the following would occur
  • Your motor insurer would cover the market value of the vehicle at that time (£8,000)
  • The Vehicle Replacement Gap would cover both the depreciation or the vehicle from the original purchase price (£20,000-£8,000=£12,000) but also add the increased cost of a replacement compared to the original price you paid (£24,000 current replacement cost-£20,000 original price paid = £4,000)
This means that you would receive:

£8,000 from your motor insurer PLUS £16,000 from the VRI Gap settlement to give you the £24,000 replacement cost in full

If you compare this with a Return to Invoice Gap then you would only get £8,000 from the motor insurer and £12,000 from the RTI Gap to give you the original Invoice price of the vehicle back. You would not get any settlement for the increased cost of a replacement car, motorbike, van etc.

When is VRI better than RTI?

The basic answer is that if you think the cost of a replacement vehicle may rise in the future then Replacement Gap may well be better than Invoice Gap. Factors that can make this the case may include:

  • where you have got a significant discount on the vehicle purchase price
  • when the manufacturer is about to update the model and reduced prices to sell current stock. The 'equivalent' vehicle in the future may be the updated model that may carry a higher cost
  • increases in VAT, a weakening value to the pound or alternations to less favorable market conditions for imports (such as being suggested by Brexit) may see equivalent vehicle prices rise in the future
  • length of Gap Insurance cover. If you take a short period of cover, say 1 or 2 years then you may not see much in the way of increased vehicle costs. Over a 5-year policy term you may find that prices rise significantly.

Why Vehicle replacement from GapInsurance123 is different and better than many others in the market?

There are many providers who can offer you Vehicle Replacement. So why would you choose VRI from GapInsurance123 above other providers? There is a feature on GapInsurance123 VRI that was added back in January 2015 that we feel makes our policy stand out from the rest and it is all down to customer feedback and claims experience.

There is an assumption that when you buy VRI Gap that the cost of replacing the vehicle rises from the original price you paid. This assumption is correct in the vast majority of claims but there can be occasions where the cost of the replacement vehicle is actually lower than the original price you paid. This could happen when you buy a demonstrator model of a relatively new model in the market where over time the model residual values lower and the equivalent model in the future may be cheaper.Which type of Gap Insurance is best?

So what you might say? The issue is that you could have bought Return to Invoice cover, paid less for the policy and actually had more in a settlement from the policy. Does that sound fair?

We had seen this happen in a few claims and even though the customer did get the correct settlement it just did not seem right that they had paid for a 'superior' cover but actually received less in settlement. So we thought about how we could prevent this happening.

We added 'Vehicle Invoice Protection' to our VRI Gap. This means that if the replacement cost actually ends up being lower than the original price you paid for the vehicle then we revert to the invoice price you paid instead. This way you get the best outcome possible.

Remember this feature was only developed because we saw cases of our customers falling foul of this situation with claims. We would stress it happens rarely but on the basis it can be difficult to say whether RTI or VRI may be best we think this is a significant benefit for extra protection.

Since we added VIP to our Replacement Gap policies we have seen several other providers add it too (must prove it is a good idea) but it is by no means universal. If you are comparing VRI products in the market then you may want to check for VIP too!

Click to find out more about Vehicle Replacement Gap or if you are happy that VRI Gap is right for you then Click for a quotation.GapInsurance123