GAP insurance saves motorists over £300m

If you're on a Personal Contract Purchase (PCP) or leasing deal and you make a car insurance claim after a write-off or theft, GAP (guaranteed asset protection) insurance covers the difference between the payout and what you still owe on the car.

With standard motor insurance policies often only covering for the current value of the vehicle, this type of specialist policy has saved many motorists on leasing deals from being out of pocket when making a claim.

In fact, GAP insurance has saved UK drivers more than £300m on claims for cars less than five years old, according to the latest figures cited by Select Car Leasing.

Damien Gallivan, head of Select Car Leasing's insurance team, said: "Car leasing has given thousands of motorists the opportunity to take to the road in a new car when perhaps it wouldn't have been possible before.

"And while it's great to drive a top-of-the-range vehicle, many need to realise being in an accident while doing so can put you at serious risk of owing the vehicle funder more than your insurance is willing to pay out. That is if you don't take out GAP insurance when it's needed.

"As consumers, we often wave away much of the aftersales options because we don't think they are worthwhile. It's vital lease customers in particular are aware of the benefits of GAP insurance. Though it is an extra cost, it will feel insignificant when you find yourself in an accident and end up owing more than the value of your car."

GAP insurance is worth considering whenever there is the potential for a difference between what your car insurance policy will pay out, and what you paid for the car or what you still owe on a leasing deal.

Without it, depreciation means that some people can find themselves losing out even when on fully comprehensive insurance policies, the car leasing company says.

For information on getting a quote visit our car insurance page.