RAC Combined Return to Invoice & Financial Shortfall GAP Insurance

What are the features of GAP Insurance?

Normally, the market value of your vehicle (how much it’s worth now) is less than the purchase price (how much it was when you bought it). If your vehicle is written off, your comprehensive motor insurance will only pay the market price – this means that you might lose money overall. Your GAP policy pays you the difference between these two amounts.

Cover available for up to 48 months*

Maximum claims benefit of up to the purchase price of the vehicle.

We will cover up to £750 towards the motor insurer excess, unless it is recoverable from a third party.

Your vehicle must be under 8 years old at the time of purchasing this cover

Contract hire/lease included to a maximum monthly rental of £1,000 including VAT*.

When it comes to Guaranteed Asset Protection (GAP) Insurance, the clue is in the name...

If an incident occurs resulting in your vehicle being written off then the settlement amount you receive from your motor insurer could be significantly less than the outstanding finance/lease agreement or the original purchase price.

The market value of your car at the time of the incident is used by most motor insurance companies to determine the motor insurer settlement payment. Any depreciation in the vehicle value would potentially be a loss incurred by you.

You could be left without a car plus the burden of settling any outstanding finance.

GAP Insurance is particularly helpful if you...

1. Would like any depreciation covered in the event of your vehicle being written off to enable you to replace the vehicle to the original purchase price you paid.

2. Need to settle any outstanding finance which was used to purchase your vehicle that may be more than the motor insurer’s settlement at the time your vehicle is written off.

How does Guaranteed Asset Protection (GAP) Insurance work?

Whether you have purchased your vehicle on finance or not, Combined Return to Invoice & Financial Shortfall GAP Insurance could return you to the original position you were in when you first purchased your vehicle. The following charts illustrate how much Return to Invoice or Financial Shortfall GAP Insurance (if applicable) could pay out if you purchased a vehicle for £15,000 and it was written off in either the 1st, 2nd or 3rd year of your policy. This is a combined policy that in the event of claim subject to the vehicle being written off you will benefit from one of the following two benefits.

1. Return to Invoice benefit

This is the difference between the price you bought your vehicle and the market value settlement provided by the motor insurer.

In this example, if your vehicle is written off in year 2 of ownership GAP Insurance could pay out £6,000; Original purchase price of the car (£15,000) minus motor insurer pay out (£9,000).

2. Financial Shortfall benefit

This is the difference between how much you owe the car finance company and the market value settlement provided by the motor insurer. We’ll make this payment directly to your finance company.

In this example the vehicle purchase is subject to a finance agreement and the finance early settlement amount at the time of vehicle write-off is £16,000.​

Pricing

The cost is dependant upon the invoice price of the vehicle and policy duration as shown below.

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Some examples of the policy exclusions and limitations

- You must be 18 years old or over to buy this cover.

- You must be a resident of the United Kingdom, Channel Islands, or the Isle of Man. If you’re applying as a company, it must be registered here.

You must hold a valid UK Driving Licence.

We won’t cover your vehicle or the driver where it is not covered by comprehensive motor insurance at the date of loss.

Anyone driving the insured vehicle must have comprehensive insurance in place.

You must buy this policy within 60 days of buying your vehicle.

Your vehicle must be a private car or light commercial vehicle weighing up to 3.5 tonnes. It must be registered in the United Kingdom.

We won’t cover you if your vehicle is used for competing in events. This can include racing, track days (timed or untimed), rallying, pace-making, or speed testing.

We won’t make any payments if you can get a replacement vehicle on a new for old basis under your motor insurance terms.

We don’t cover vehicles purchased for less than £5,000 or over £100,000.

We may cover the up-front payment for a contract hire vehicle, but we don’t cover vehicles where the monthly charge is over £1000.

We won’t cover your vehicle if you’ve modified it unless the changes were made specifically for disabled drivers.

We won’t pay any claims if your vehicle has not been written off or your motor insurer rejects your claim.

We won’t cover you if your motor insurer has offered to repair your vehicle and you’ve requested your vehicle be written off.

We won’t cover using your vehicle for ‘hire and reward’. This means using your personal vehicle to provide a paid transport service. This can include using your vehicle for taxi/private hire, daily rental, breakdown and recovery, driving school tuition, deliveries or chauffering.

How to make a claim

If you need to make a claim under this policy, please call 0330 100 3427 (Monday - Friday, 9:00am - 5:00pm). TWG Services Limited, the claims administrator, will check your policy details and tell you what to do next.

Alternatively, you can write to: Customer Relations Department, TWG Services Limited, The Aspen Building, Floor 2, Vantage Point Business Village, Mitcheldean, Gloucestershire, GL17 0AF

Combined Return to Invoice & Financial Shortfall Guaranteed Asset Protection (GAP) Insurance is underwritten by London General Insurance Company Limited which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, Financial Services Number 202689. London General Insurance Company Limited, registered in England and Wales (Company number 1865673) Registered office: Twenty Kingston Road, Kingston Road, Staines-upon-Thames, Surrey, TW18 4LG.