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Vehicle Replacement GAP Insurance

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What is Vehicle Replacement Plus GAP Insurance?

What is Vehicle Replacement Plus GAP Insurance?

In the event of a total loss (accident, theft, fire or flood damage) your motor insurer will only pay you what the car is worth at the time of the claim.

With Vehicle Replacement Plus, you will receive an additional settlement to cover the financial shortfall between your insurer’s settlement and the replacement cost of your vehicle. If you have a finance agreement, we will pay up to the outstanding balance on the finance agreement if this is the higher amount at the time of the claim.

This policy is suitable if you’re concerned about potential price increases where the cost of buying the same car again could be higher than the amount you originally paid; however, the replacement cost could also be the same or lower.

What do we mean by “replacement cost”?

This the cost of buying a vehicle of the same age, mileage, make, model and specification as the one originally purchased.

This means that, if you buy a brand-new car which is subsequently written off, Vehicle Replacement Plus will top up your insurer’s settlement to the cost of an equivalent brand new car.


Do I need Vehicle Replacement Plus?

Can I buy Vehicle Replacement Plus?

Do I need Vehicle Replacement Plus?

The answer to this is yes if:

You have a finance agreement, have enough money to clear any outstanding finance AND be left with the remaining money towards a replacement car

You do not have any finance, the settlement amount can be used however you wish

Can I buy Vehicle Replacement Plus?

The answer to this is yes if:

You have bought a vehicle worth less than £125,000

Your vehicle is less than 7 years old, with less than 80,000 miles

Your vehicle was collected from a VAT registered dealer within the last 90 days

Your vehicle is owned outright OR you have a Hire Purchase or Personal Contract Purchase finance agreement

Your vehicle is not excluded as one of the following: Any taxi, mini cab, driving tuition vehicle, courier or delivery vehicle of any type or any private or public rental vehicle or any rally, competition or off-road vehicle of any type.

Exclusion list:

Unfortunately we do not offer GAP insurance cover for any Commercial Vehicle over 3500kg, Motorcycle, Motor Scooter or Moped. Any left hand drive vehicle and a vehicle which does not meet UK or EC approval or is not commercially available in the UK direct from a manufacturer or its authorised importer or dealer. Any taxi, mini cab, driving tuition vehicle, courier or delivery vehicle of any type or any private or public rental vehicle or any rally, competition or off-road vehicle of any type.

Vehicle Replacement Plus Example

Covered

£15,000

Shortfall

£8,000
*Example shows the amount covered by your Comprehensive Vehicle Insurance (based on average depreciation rates and current market value) and the potential shortfall if your vehicle is written off.
WITH FINANCE
WITHOUT FINANCE
Your invoice value of: £20,000
Replacement cost at time of claim: £21,500
The amount owed to the finance company at the point of claim: £23,000
Your comprehensive market value insurance payout: £15,000
Our Vehicle Replacement Plus payout: £8,000
Comprehensive Insurance payout + ALA GAP Insurance payout = £23,000
(Leaving you clear of any owed finance on your vehicle)
Your purchase price: £20,000
Replacement cost at time of claim: £21,500
Your comprehensive market value insurance payout: £15,000
Our Vehicle Replacement Plus payout: £6,500
Comprehensive Insurance payout + ALA GAP Insurance payout = £21,500
(Leaving you clear of any owed finance on your vehicle)

FAQs

I’m looking at a Vehicle Replacement quote. What figure do I use as my purchase price?

For the purposes of a quote please use the invoice price of the car including manufacturer fitted extras. Please also include dealer fitted extras, as these are covered up to a maximum of £1,500 including VAT.

Deduct any dealer or manufacturer discount (including deposit allowances, concessions, cashback, incentives or contributions).

Other things we don’t include: Interest charges, manufacturer delivery charges, paint/upholstery protection, fuel, road fund licence, warranty costs, administration fees, insurance, service plan costs, arrears and negative equity.

If you would like any assistance with a quote, please contact our team on 01653 916304

What is the difference between Return to Invoice and Vehicle Replacement?

Return to Invoice Plus will cover the difference between your motor insurer’s settlement and either your invoice price or outstanding finance – whichever is greater at the time of a write off.

The Vehicle Replacement Plus policy will pay the difference between your motor insurer’s settlement and either the replacement cost of a vehicle of the same make, model, age and specification as the original vehicle or the outstanding finance, again whichever is greater at the time of a write off.

I own my vehicle outright, which GAP Insurance do I apply for?

If your vehicle is less than 7 years old, has covered fewer than 80,000 miles and has been purchased in the last 90 days, we are able to offer you Vehicle Replacement Plus GAP Insurance.

The Vehicle Replacement Plus policy covers the difference between your motor insurer’s settlement and the replacement cost of a brand new vehicle, if your vehicle was new at the time of purchase. Alternatively, if your vehicle was not brand new, it covers the difference up to the cost of a vehicle which matches the age of the vehicle that you originally insured.

If you’ve had the car for more than 90 days, or it exceeds the above age limits, we can instead offer you a Return to Invoice Plus policy.

The Return to Invoice Plus policy pays the difference between your motor insurer’s market value settlement and your original invoice price.

Policy Documents

View Policy Wording and IPID for Vehicle Replacement GAP Insurance.

As we work with a couple of scheme providers to get you the best price there are different policy wordings dependent on the scheme provider. We recommend familiarising yourself with all policy documents before purchasing.

These documents are available to view when you get a quote, too.