Gap Insurance

[GWilso]

After my new purchase Lexus offered me their GAP insurance which I am keen on but they want £399 for 3yrs....

there are a lot of companies out there offering this at a dam site cheaper rate than Lexus most around the £150 mark I know Lexus may be that bit more comprehensive but insurance is insurance

Does anyone on here have any recommendations on aftermarket GAP insurance or ever had to use it any views appreciated

Don't get me wrong I'm not on a money saving mission but if i can save almost £250 buy using someone else for the same policy then why not

Cheers

Gordon

[WylieCoyote]

GAP is something that can make a useful haggling tool when you're buying the car as you can get it built into the deal and save a bit on it. Having said that you're still in a position to save. Say to Lexus that you've found loads cheaper and if they can come closer to their price then you'll have it off them, if not you'll shop elsewhere. Even if they drop to £300 or £250 it's closer and I'd take the Lexus one if it was me.

Keith

[GWilso]

Thanks mate Gap insurance wasn't something I was aware you could haggle on so thats a good tip ill let you know how i get on

Thanks Again

Gordon

GAP is something that can make a useful haggling tool when you're buying the car as you can get it built into the deal and save a bit on it. Having said that you're still in a position to save. Say to Lexus that you've found loads cheaper and if they can come closer to their price then you'll have it off them, if not you'll shop elsewhere. Even if they drop to £300 or £250 it's closer and I'd take the Lexus one if it was me.

Keith

[WylieCoyote]

You can haggle on anything to get it included in the price or at a reduced rate. I always have done and it's always worked for me. Having said that I'm a salesmans worst nightmare because I demand everything!

Little story, I went to test drive a Golf GTI last year and the dealer wouldn't give me the deal I wanted so I walked out. I'd told him what other dealers I was going to that day and he'd rung ahead to warn them about me! Needless to say I didn't buy one - that irritated me!

[GWilso]

I had a pretty good go at ****** of the dealer too when i bought this as I never quite got the price PX i wanted so i made sure i made up for it in other ways Such as full tank of diesel 12mths Tax and retaining my current tax disc on the px, Oh and my misses went bright red when i demanded the lexus teddy they have in the window as part of the deal

You can haggle on anything to get it included in the price or at a reduced rate. I always have done and it's always worked for me. Having said that I'm a salesmans worst nightmare because I demand everything!

Little story, I went to test drive a Golf GTI last year and the dealer wouldn't give me the deal I wanted so I walked out. I'd told him what other dealers I was going to that day and he'd rung ahead to warn them about me! Needless to say I didn't buy one - that irritated me!

[WylieCoyote]

Oh and my misses went bright red when i demanded the lexus teddy they have in the window as part of the deal

I'm in awe!!!!

There was a case a few years ago in my town about this guy who went to the Vauxhall garage and bought a new car, part ex'd his old one on some '£1000 minimum part ex' deal or whatever as it was only a banger so they didn't even bother evaluating it. When he went to pick the new car up, he'd stripped the old car of everything - I mean everything - including engine, wheels, the lot and dropped it off on the garage forecourt and was like 'your problem now' and he drove off in his new car. All the stuff he'd taken off he sold and made a fair whack in addition to the £1k part ex they gave him and the good deal he got. Even that doesn't beat the teddy though!

[GWilso]

Keith you really are a legend Lexus cambridge just came back to me and took the Gap insurance from £399 - £279 so you saved me £120 thanks mate I owe you one

Gordon

GAP is something that can make a useful haggling tool when you're buying the car as you can get it built into the deal and save a bit on it. Having said that you're still in a position to save. Say to Lexus that you've found loads cheaper and if they can come closer to their price then you'll have it off them, if not you'll shop elsewhere. Even if they drop to £300 or £250 it's closer and I'd take the Lexus one if it was me.

Keith

[WylieCoyote]

You're welcome Gordon. Happy to help :)

Still loving the teddy negotiations!

Keith

[Parthiban]

Bit late coming on to this one, but yes always haggle with GAP insurance, to be honest I always use it as the final bargaining tool, once you've haggled on everything else you can think of, the last one to throw in is the GAP! I think when my dad bought his merc a few years ago, we got the GAP almost free! :)

Well done on sorting it out, and you'll have to put up a pic of this teddy, I wasn't aware there was one! :D

[Giblet]

not sure about the other market GAP insurance but the Lexus and most other manufacturer based ones are tied to a replacement not the cash. For example the Lexus and BMW one I had before gave you the invoice price off a replacement car of same make, not the invoice price back in your hand to buy what you wish. I'm happy with that, but may be a difference between open market GAP which may offer cash, don't know myself but thought worth offering up to anyone who is considering wich one to buy. Read the small print.

[TigerFish]

not sure about the other market GAP insurance but the Lexus and most other manufacturer based ones are tied to a replacement not the cash. For example the Lexus and BMW one I had before gave you the invoice price off a replacement car of same make, not the invoice price back in your hand to buy what you wish. I'm happy with that, but may be a difference between open market GAP which may offer cash, don't know myself but thought worth offering up to anyone who is considering wich one to buy. Read the small print.

I'm confused about what you are saying the GAP insurance is for. Under what circumstances are you saying it would pay out? It shouldn't ever be paying out to you, only to the dealer when you come to trade the car back in for the value they "claimed" it would be worth when you took the finance package. i.e. if they said it would be worth £6,000 after three years with a max of 20,000 miles on the clock, but when the deal was up it was only worth £4000, the insurance will pay the difference so that you get the full trade in value. However, it may well not pay out if the reason for the drop was that you had done 30,000 miles and therefore gone outside the terms of the original agreement. Oddly, on the finance house software I developed, the calculations for the GAP insurance premiums was remarkably unsophisticated. Basically, it was the value of the monthly instalment. What made it even funnier (and evidently a complete ripoff) is the fact that the longer the term of the finance, the lower the GAP premium (because the monthly instalments were lower). So the time when you are more likely to need it, you actaully got it cheaper. Got to love the cons that the motor industry can come up with.

[dave1]

The GAP ins. I took out was to pay out to me if the car was written off or not recovered,to cover the difference between the ordinary car insurance valuation/payout and the invoice price that I paid for the car.Mine was not based on any future deal,trade-in or purchase but to fill the GAP between purchase price and insurance payout.

[TigerFish]

The GAP ins. I took out was to pay out to me if the car was written off or not recovered,to cover the difference between the ordinary car insurance valuation/payout and the invoice price that I paid for the car.Mine was not based on any future deal,trade-in or purchase but to fill the GAP between purchase price and insurance payout.

So you are saying that you buy the car brand new, it gets written off two years later, the insurance pay the market value of a two year old car and the GAP insurance pays you the rest to make up the brand new price you paid?

Did you pay cash? If it is taken out as part of a finance deal, why would it pay out to you? The car is on finance and owned by the finance company, so the money is to settle the finance if there was a shortfall from the insurance payout.

Or, As I mentioned before. You pay a deposit, pay so many months of whatever pounds, then at the end pay a lump sump of blah pounds or give the car back or part ex it on a new finance deal. The GAP insurance covers the shortfall of that equivelent lump sum if you decide to give the car back. i.e. the car is not worth what they originally predicted and therefore the return value would not settle the finance, which would be your responsibility.

Maybe that is the difference between various prices GAP insurances, the benefits they offer.

[Giblet]

As Dave said. Gap insurance is to top up your insurance in case of a write off to the amount you paid for the car. If it is on finance they will take that into account.

My point was that the GAP insurance i've had don't actually pay you a penny they take your insurance payment and put it towards a replacement same brand car and make up the difference to what you paid originally. In effect the manufacturer is no doubt just doing some sort of discount to get another sale on the road.

So what i was pointing out was whether one of the differences in price between independent GAP and their pricing and what say Lexus dealers offer is whether you get cash or a discount off another same brand car. Not having had an independent version of the GAP or even looked at one I can't say. I just know how the others work.

[dave1]

The GAP ins. I took out was to pay out to me if the car was written off or not recovered,to cover the difference between the ordinary car insurance valuation/payout and the invoice price that I paid for the car.Mine was not based on any future deal,trade-in or purchase but to fill the GAP between purchase price and insurance payout.

So you are saying that you buy the car brand new, it gets written off two years later, the insurance pay the market value of a two year old car and the GAP insurance pays you the rest to make up the brand new price you paid?

Did you pay cash? If it is taken out as part of a finance deal, why would it pay out to you? The car is on finance and owned by the finance company, so the money is to settle the finance if there was a shortfall from the insurance payout.

Or, As I mentioned before. You pay a deposit, pay so many months of whatever pounds, then at the end pay a lump sump of blah pounds or give the car back or part ex it on a new finance deal. The GAP insurance covers the shortfall of that equivelent lump sum if you decide to give the car back. i.e. the car is not worth what they originally predicted and therefore the return value would not settle the finance, which would be your responsibility.

Maybe that is the difference between various prices GAP insurances, the benefits they offer.

[dave1]

Your scenario with 2 year old car is correct.My GAP would have paid any shortfall between insurance valuation and original invoice price direct to me as the owner.If on certain types of finance that would be taken into account,but on cash or via personal loan not secured on purchase the car belongs to you from day 1.In the same way as your primary insurer pays "cash" to you on total loss,the GAP does the same and how you spend the money is up to you as it is YOUR cash.I would not consider any GAP or similar that was restrictive unless it was very much cheaper and I had checked all of the contract very carefully.

[TigerFish]

If on certain types of finance that would be taken into account,but on cash or via personal loan not secured on purchase the car belongs to you from day 1.In the same way as your primary insurer pays "cash" to you on total loss,the GAP does the same and how you spend the money is up to you as it is YOUR cash.

Yes, I should've been more specific on the finance being secured on the car.

As I said though, maybe depending on the supplier of the GAP insurance, secured finance or after market, the focus of the insurance is perhaps different and what it covers. Certainly with the motor finance company I worked for, they were interested in protecting their own interests and not the customers, so short falls on the residual value of the car at the end of the term of the finance had big implications for them and they wanted to make sure any short coming could be claimed from insurance rather than the cost of going through the courts. Of course a total loss scenario has the same implications. The number of total losses is far less that the number of finance agreements that run their course fully, so the residual value issue is a much greater one to a finance company. Hence why they were always prepared to barter on the cost of it to get it included in the deal, even if they appear to be almost giving it away.