Many people seem to get confused about exactly what contract hire gap insurance is and what it does. If you have acquired a car through contract hire for personal or business use and can never own the vehicle after a matter of time, then Contract Hire Gap insurance is the only Gap insurance for you and your vehicle.
So what is Contract Hire Gap Insurance and what does it mean for you and your car?
If unfortunately you are the subject of vehicle theft, or you are involved in an accident in which your car is written off, your Contract Hire company will not suddenly forget about the outstanding money that you owe to them, no matter what the circumstances are. Now unfortunately not many people realise that your own motor insurance, although a necessity to allow you to drive on our roads, will only pay the amount to the contract hire company of what the cars valuation was on the day it was written off or stolen. This has usually depreciated by a significant amount depending on long you have had the vehicle for, with most vehicles depreciating by 50% within their first three years. So as has been pointed out, you may find yourself with a significant amount of money to find on your own to pay your contract hire company back, if you are not fully covered.
As unbelievably easy as it is, contract hire Gap insurance will pay the remaining outstanding balance to your Contract Hire company, leaving you to to focus on the more important things like getting better after an accident, or finding a new car after a theft. Contract Hire Gap insurance could literally save you thousands of pounds. Gap insurance is literally something you can lean on in a situation like this one, taking financial strain off you and offering full support.
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