GAP Insurance

[JustDerv]

I'm in the process of buying a new car (well new to me anyway!) and have been offered 'Return to Invoice' gap insurance at the dealer for £399.

Now I recall there are companies which specialise in gap insurance, so I said I'd think about it and have since found some companies on the web. The one I'm looking at in particular is called Direct Gap, part of Motor Gap, and the blurb on the web is that they only use FSA registered insurers.

For comparable RTI gap insurance, the dealer quote of £399 becomes £97 with Direct Gap

Why so cheap? Should I be wary, after all they often say if it's too good to be true.....

Any advice, or does anyone have any experience of specialist gap insurers?

Thanks

[eltawater]

iirc I paid 120 for 3 years GAP from Hitachi finance in 2008, on return to invoice terms.

The discrepency is likely to be the massive profit margin and commission for the salesman built into the price. After all, you've just handed over a load of money for your new pride and joy, it's very convenient for you to cover yourself at the same time....

[Steve H]

As already said the dealership has a big profit margin in the policy as well. We sell GAP cover at £199 for 3 years and on new cars it is RTI but on used the value is agreed at the begining. Read the T&C's carefully and check things like:
Are you covered if your car is written off\stolen whilst abroad
Is your policy excess also covered

Steve

Edited by Steve H on Wednesday 12th January 18:03

[theaxe]

The BMW GAP insurance on my car was something like £750!

I looked around on the net and found lots of companies offering polices for more like £250
but some research revealed that some of them were pretty dodgy, with offices (according to street-view) above fried chicken shops in Birmingham for example.

In the end I found one where the company number checked out and were underwritten by Groupama.

Edited by theaxe on Wednesday 12th January 18:18

[amirzed]

last year my sis bought a Mercedes, dealer GAP was 399, internet GAP was about £100, dealer ended up doing it for £80.

There must be a hell of a margin there....