There are three types of policies to choose from when you get a quote:

1. Vehicle replacement insurance (VRI) is suitable for second-hand cars, it covers the difference between the insurance pay-out and the cost of replacing your car to the same specification as when it was bought.  

2. Return to invoice (RTI) is suitable for cars that were bought brand new. It pays the difference between the insurance pay-out and the original value of the car. If your car is declared a total loss, the difference between your insurer’s payment and the cost of your vehicle when you bought it is covered, including any outstanding finance.  

3. Finance, lease & contract hire protects you in the event of your vehicle being declared a total loss. It’s suitable for HP, PCP, lease and contract hire vehicles. This type of gap insurance will pay the difference between the outstanding finance balance and the motor insurer’s settlement.

New cars depreciate quickly. Sadly, from the moment they leave the shop their value drops. Generally, a new car depreciates a staggering 20% per year on average.

For example, if you purchased a car for £20,000, by year three it’ll be worth about £10,000 at market value, based on approximately 20% annual depreciation.

If your car is declared a total loss, your insurer will only pay out the market valuation of £10,000. It’s unlikely that this’ll be enough to buy a newer equivalent model, leaving you to fork out for the £10,000 shortfall or settle for an older car.

Having gap insurance in place would mean you would get £20,000 in the event of a claim, £10,000 from your insurer and £10,000 from gap insurance. So you’d be able to get a new replacement without having to dip into your own pocket*.

Gap insurance could be worth considering if you’re worried about not getting the price you paid for your car back if it was written off or stolen. Or if you’re likely to be in negative equity if something was to happen your car.

*Return to invoice or vehicle replacement policies only.

We’ve partnered with Direct Gap who can provide you with a quote in less than a minute. All you’ll need to get a quote is:

• The value of your car when you bought it, excluding modifications added after purchase
• How many years cover you need, ranging from 1 to 5 years

You’ll then be given a quote for 3 different types of policies on offer. Choose the option that’s right for you and buy to start your cover.

The cost of gap insurance depends on the type of policy you choose, the length of policy, and the purchase price of your car.

The table below gives you an average cost for each policy type based on a 3-year policy. Information is from Direct Gap.

We don’t offer a comparison for gap insurance, we have a chosen provider who offer cover which is powered by Direct Gap.

There are also a range of specialist providers who offer cover, so if you want to shop around and compare prices, you’ll need to visit them separately.

Most car dealers will offer gap insurance policies when you buy a car, but independent research shows it’s 50% cheaper to buy direct from an insurer, compared to a car dealership.

• No fees for paying by credit card, with monthly payment options available over 12 instalments (subject to status)
• A quick resolution - they aim to settle any claim within 10 days
• No charge for amending your policy with new registration number or address details
• Cover for all named drivers on your policy
• £250 towards your motor insurance excess

In order to qualify for gap insurance, the age, mileage and price of the car must fall within a certain range and the car must feature in Glass’ Guide.

Most policies cannot cover:

• Cars with a purchase price of over £75,000 (unless they have an approved tracking device)
• Vehicles over 10 years old
• Vehicles that have driven more than 100,000 miles when the policy is purchased

You should also note that gap insurance doesn’t cover taxis, private hire vehicles, cars and vans used for any other type of ‘hire and reward’, or vehicles used for racing, rallying or any other competitive event.