If you were heaven forbid involved in an accident in which your car was written off, nobody would blame you for mistakenly thinking that you are fully covered, due to the fact you have regular motor insurance. In fact, unbeknownst to many people out there, although a necessity for allowing you to drive on our roads, your motor insurance does not in fact reimburse the full amount you paid for your vehicle. The shocking fact of the matter actually is, that your motor insurance will only award you the amount that your car is worth on the day it was stolen or written off. This at first may not worry you, you may think that your car value would have only dropped by a measly insignificant amount that may not actually have much effect on your finances, unfortunately you would be wrong. On average, cars depreciate by up to 50% within their first three years. It could literally be thousands of pounds you are out of pocket for.
Return to Invoice Gap Insurance
This is exactly where Return to Invoice Gap insurance could help you. This type of Gap insurance literally pays the difference between the valuation your car is on the day it is written off/stolen (the amount your motor insurance will pay) and the amount you paid/still owe to the finance company, literally filling in the gap. This really is the only way you can ensure that you and your vehicle are protected fully, please don’t make the mistake of thinking any of this doesn’t apply to you. With 600,000 a year written off in the UK and crime on the rise, a one off payment of Gap insurance literally could be the difference between you losing thousands of pounds and being satisfied.
A Return to Invoice Gap Insurance example:
If you bought a Honda Civic for £20,595, according to whatcar.com depreciation calculator, on average within two years, the car would have a valuation of £11,875, which is what your motor insurance would award, this would mean that if you were involved in an accident where your car was written off, or your car was stolen, you could find yourself £8,720 out of pocket. With Return to Invoice Gap Insurance, you would be fully protected, this would pay the difference between the amount your motor insurance had awarded and the invoice price you originally paid, meaning you would be standing in the same position you were in before the unfortunate event. This leaves you to focus on the more important things like getting better after an accident, or looking to buy a new car. Don’t leave yourself open to a financially devastating situation.
Remember that if you can never own your vehicle then Return to Invoice Gap insurance is not for you, Contract Hire Gap Insurance is.