Gap insurance if you buy car in cash?

[Sheldonsheher]

Should you get gap insurance if you buy a car in cash.
New car cost 27k and new so can depreciate.
the dealer has insurance £300 for 3 years Seems pretty cheap to me looking in line although everyone says not to get from dealer?

Gap insurance is to cover the gap between finance that you oweandthe value of the car.

Typically if you buy a car on finance in its first year or so, it will depreciate faster than the amount owed. For example you buy a car for £25k and you owe that much. Four months after you lease the car, you are in an accident that is not your fault and your car is written off. You owe £24,500 but the car is worth £21k. Your insurance company pays £21k and you have to pay £24,500 to.the finance company and get a new car.

Gap insurance pays out the £3,500.

If you bought it outright it's an unnecessary expense because you don't owe the finance company anything.

Gap insurance is to cover the gap between finance that you oweandthe value of the car.

That’s what I thought too?

Doesn’t have to be though. Return to invoice GAP will be handy if the car’s written off after 2.5 years even if you paid cash.

That’s why I’m not sure if I need it. I guess can see what the main insurance would pay out. Seems crazy you need double insurance.

It’s not crazy at all but like all insurance products it’s a complete waste of money if you don’t use it and an absolute bargain if you do. If your car gets written off in 2.5 years and your insurer gives you £12k you’ll be wishing you spent that £300.

Just ran a quick quote, should be more like £200.

You will back in your original financial position prior to purchase if your car is written off. You can go off and buy a new car rather than one a few years old. It's good for cash buyers as well as finance purchases. If a car is 4 years old plus insurers normally deem it uneconomical to repair.

£200 to cover the whole three years?

We have had GAP insurance on outright purchases and lease ever since our 1.5 year old car, bought brand new, was written off after an accident. We lost 30% of what we paid for it. Never again.

I've always got gap insurance if I've bought a new or almost new car. And I've always paid cash for the car

For the sake of a couple of hundred pounds it's worth it.

Yes. That was RTI based on a value of £27k

I would shop around and not necessarily purchase from the dealer.

We've got gap insurance for both cars we've bought recently in cash. They depreciate massively, so if written off after, say, 6 months, you could lose a few thousand pounds, and end up having to buy a replacement probably older and more mileage than the one written off. We do low mileage and really look after our cars, so we like the idea of gap insurance to be able to purchase a truly "like for like" which would probably be new again.

Hi there,
I've just come across this thread when googling and wanted to add that with cars bought for cash you'd probably be best with vehicle replacement.
Something like this: https://www.directgap.co.uk/gap-insurance/vehicle-replacement-plus/

There used to be one called 'agreed value' but I think most insurers have done away with that now.

Hi there,
I've just come across this thread when googling and wanted to add that with cars bought for cash you'd probably be best with vehicle replacement.
Something like this: https://www.directgap.co.uk/gap-insurance/vehicle-replacement-plus/

There used to be one called 'agreed value' but I think most insurers have done away with that now.

Thanks the regular insurance covers the first year to the value of a car but may need gap insurance for next year

My answer would be based on the type of car. Is it an EV I definitely would get return to invoice price gap. As an example my car is 3.5 years old, the person I got it from paid £125,000 for it…..we just bought it for £50,000.