GAP insurance — what it is and when it is worth it
GAP covers the difference between what the insurer pays you and what you actually owe or paid. It is worth most in a total loss or a theft.
The problem GAP solves
In a total loss or a theft, comprehensive cover pays out the market value of the vehicle — and that falls over time. A problem arises if:
- on a lease or finance you owe more than the vehicle is worth, or
- you bought a new vehicle that has lost part of its value in its first few years.
The market-value payout then leaves you out of pocket. GAP covers that difference.
How GAP works
GAP tops up the amount beyond what comprehensive cover pays — up to the outstanding debt or up to the purchase value of the vehicle, depending on the type of policy.
Types of GAP
- Finance GAP — covers the difference up to the outstanding debt on the lease or loan.
- Return to invoice — covers the difference up to the price you paid for the vehicle.
Who it is worth it for
- You drive on a lease or finance,
- you bought a new or more expensive vehicle,
- the vehicle loses value quickly.
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Try the Claimo demoFrequently asked questions
Does GAP apply to theft as well?
Yes. GAP is most useful precisely in a total loss or a theft, when comprehensive cover pays only the market value.
Do I need GAP if I paid cash?
It is less useful because you have no debt; possibly on a new vehicle, to protect the purchase value.
How long does GAP last?
It depends on the policy, usually the first few years — check the terms with your insurer.
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Note: this guide is general information, not legal or insurance advice. Check the terms of a GAP policy with your insurer.