Does anyone use gap insurance?

[incognito1991]

Getting my first car on HP tomorrow, due to reasons that aren’t important, the interest is a lot, I’m essentially paying double than what the car would have been bought outright. Due to this, if I was in an accident I would be pretty screwed owing the entire balance. Looked into gap insurance but unsure what it is, some information says it covers what the car’s worth where others say it will also cover interest on my agreement, does anyone know?

it covers the difference between what you are owed on the car financewise and the overall value of the car in the event it is written off in an accident. I always take out gap insurance on my PCPs.

I bought this when I was about 20 buying a brand new car. Someone drove through a red light and wrote my car off….id forgotten I’d bought it and received a cheque for £6k in the post which i wasn’t expecting. I was very glad I bought it.

I’ve just bought a new car and took out gap insurance. Mine is return to invoice gap insurance with MotorEasy and I got a discount through the MSE website.

https://www.moneysavingexpert.com/insurance/car-insurance/gap-insurance/

So do I.

In your situation, it is very important to take out GAP insurance. Do not take the one that the garage will offer you as it will be ridiculously priced. Go online and do it yourself.

for a new car, even second hand “new to you” from a dealer gap insurance is worth it.

in simple terms it covers the difference between what you paid and what the insurance will cover.

so for a new car it will pay off anything you owe.

for my second hand car it will pay the difference between the purchase price and the book price (about 2k).

i think it was about 200 for 3 years, and as i have young adults driving it was worth it.

It’s a risk
I know someone who bought a car for 21k wrote it off 5 days ago later lost 3.5k plus there £500

Car finance is usually front loaded with interest so the balance if the car ia written off is not usually the full amount of finance take out, it is the amount from the point of taking it out upto the point the car is written off.

For example dh bought a car for £8.5k in March, some melon drove into the back of it 3 weeks ago while he was sat at a roundabout.

The finance owed is £8.2k at the point they car was written off.

The insurance company have decided the car was only worth £6k despite us showing various exact cars selling for upwards of £8k.

Gap insurance would have covered the 2k difference between what the insurance are paying out and the 8k the car is actually worth/8.5k he paid depending on type.

Dh didn't take out Gap insurance despite me telling him to.

Don't be like dh!!!