Gap Insurance info required please.

[the slipp]

My son's car has been written off by his insurance company, they have offered him £8600.00 payment,when he bought the car two and a half years ago he paid £16000.00 for the vehicle but he did take out the Gap insurance on the vehicle.

My question is this will the Gap insurance company make up the deficit (from £8600.00 to £16000.00) or just make a payment to finish finance outstanding on the car?

Any help would be great thank you and Merry Christmas to all.

[flyingdoc]

The gap insurance is there to make up the defecit between what it paid by insurers and outstanding balance owed. That is the point.

On what basis are the insurers offering such a low valuation?

 

I would challenge that first of all - that is a small amount.

[the slipp]

Doc, i think that was the market value quoted, But i took out Gap insurance on my car and i didn't have finance so where would i stand if my car £19000.00 was written off before the three years were up?

Thanks for your help,Slipp

[flyingdoc]

you would have to check your policy but as I understand it gap insurance is there to either

1 pay off outstanding finance when the payout from insurance doesnt cover it

2 give you the ability to buy an equivalent age car to the one you lost, if the insurance doesnt pay out enough.

 

talk to the insurance providers and see what they say, but I would still query the insurance valuation - have you checked parkers price guide??

[ukaviator]

A Gap Insurance policy will cover you against financial loss should your car be stolen and / or written off, filling the gap between the current market value at time of write off and the original purchase price and any outstanding finance.

 

As Flyingdoc says, check your policy small print as there are a couple of types of Gap insurance products out there.

[the slipp]

Thanks again everyone.