People can sometimes become confused about what contract hire gap insurance is and what it does. If your vehicle has been acquired through a contract hire arrangement, either for personal of business use and you can never own your vehicle, then contract hire gap insurance is the only gap insurance suitable for you and your vehicle.
What is Contract Hire Gap Insurance?
If you ever find yourself the subject of vehicle theft, or are involved in an accident where your car is unfortunately written off, your contract hire company will not forget about the outstanding payments that you owe to them, regardless of the circumstances. Many people do not actually realise, that your motor insurance, although completely necessary to be able to allow you to drive on our roads, will only pay the amount to your contract hire company, of your cars valuation on the day it was stolen or written off. Due to depreciation, this is likely to be less than the car was worth when you originally drove it away from the showroom, most vehicles actually depreciate on average by 50% within their first three years. So, you may find yourself with a significant amount of money to acquire to pay your contract hire company the outstanding payments back to them if you are not covered.
Contract hire gap insurance will pay the remaining balance (from market value at point of total loss and the money owed to your contract hire company) leaving you to focus on the more important things, like organising yourself to acquire a new car, or regaining confidence and strength after an accident. Contract hire gap insurance could literally save you thousands of pounds. Gap insurance is there to protect you and your vehicle so that you do not end up in a financially devastating situation, with no car and a very large sum of money owed to your finance company. Don’t leave yourself exposed.
Contract Hire Gap Insurance for different manufacturers?
As we are all aware, not everybody has the same car, there are thousands of models out there in many different combinations, with added features, or without. The maximum amount that will be paid out will be subject to whichever claim limit is chosen and therefore shown in your policy schedule. It is important to familiarise yourself with claim limits, although nobody can ever truly know how much a vehicle is going to be worth in a particular amount of time, it is always best to air on the side of caution. Learn more about Claim Limits?
The thing to remember is, your car must be listed in Glass’s Guide for cover to be provided. It must not have been recorded previously as an insurance total loss. If your car has been modified, contact your gap insurance provider for full clarification. If you use your car as a taxi, then an additional premium must be paid, please agree this with your gap insurance provider. Your vehicle cannot be insured by gap insurance if it is a heavy goods vehicle weighing over 3,500 kg. Mini buses with over 19 seats cannot be covered. If you wish to use your vehicle for rallying, road facing or other competitive events, then unfortunately gap insurance cannot provide cover. Vehicles that have a purchase price of over £75,000 that are not fitted with a Thatcham or a tracking device that has been approved by a manufacturer, then unfortunately cover cannot be provided.
Please see our Manufacturers pages, to find out more about contract hire gap insurance for your particular model!