Do you ever wonder what sort of insurance payout you’d be looking at in the unfortunate event that your car is written-off? Would it be enough to fund a like-for-like replacement? Or would you have to find an additional lump of money?
Sadly, however good your insurance police is, you’re unlikely to receive enough money to fully fund the purchase of a replacement car or settle any outstanding finance.
All too often, motorists find that their insurance payout is some way short of the sum they need to buy a new like-for-like replacement, leaving them in a tricky financial situation that they simply didn’t see coming.
No one likes to contemplate the worst-case scenario, but It pays consider what sort of payout you’d be looking at in the event of a write off or theft and take measure to ensure you’re fully protected.
What does complete insurance protection look like?
GAP Insurance from MotorEasy® is designed to bridge the gap between the payout your insurer offers in the event of write-off and the amount you need to purchase a like-for-like replacement. In effect it tops up your existing policy, ensuring that you won’t find yourself having to come up with a substantial lump of money to replace your car.
Why do I need GAP Insurance?
The problem with most car insurance policies centre around one key issue – depreciation.
Depreciation is an unfortunate reality that almost all car owners must take into account. The unavoidable truth is that most new cars depreciate in value, often very quickly. In fact, new cars typically depreciate in value the moment you drive them off the dealership forecourt. On average a new car will have dropped in value by 60% after three years.
Why does depreciation impact my potential insurance claim?
It’s likely that your insurance policy will only pay the current market value of your car in the event of a write-off. This means that you’re probably looking at a payout that’s significantly short of the sum you originally paid for your car.
Consequently, if you purchased your car for £40,000 and need to make a claim three years later, you could be looking at a payout of just £14,000, assuming the value of the car has depreciated 60% in three years. This would potentially mean you’d have to find £26,000 on top of your insurance payout to buy a new like-for-like replacement.
MotorEasy® GAP Insurance guards you against this scenario, covering you for the car’s value at inception by increasing in value over time as the value of your car depreciates. It’s a great way to offset depreciation and ensure that you don’t find yourself facing a huge bill to replace your car.
Does GAP Insurance make financial sense?
It’s easy to hope for the best and dismiss the possibility of a write-off as unlikely, but it’s actually far more common than many people think - almost half a million cars are written off in the UK every year.
Car insurance is supposed to provide peace of mind, so it’s disappointing to discover that most policies are found wanting when it comes to the crunch. It’s wise to contemplate the worst-case scenario and protect yourself against it, which is precisely what GAP Insurance is designed to offer.
MotorEasy® GAP Insurance offers complete peace of mind at an affordable price. If you value your car and want to protect your investment it represents a savvy addition to your existing policy.
Our GAP Insurance is a cheaper way to get the cover you need, offering a saving of up to 70% on dealer insurance policies.
Getting your MotorEasy® GAP Insurance quote is quick and easy. Our GAP Insurance page gives you all the information you need and a quick and east tool to get you GAP Insurance quote in a matter of seconds.