GAP or car depreciation insurance

If you compare car insurance quotes UK, you are likely to come across a term called car depreciation insurance or simply GAP insurance. Car depreciation insurance acts like a top up to your vehicle insurance. A general motor insurance policy will pay you only if your car is stolen or in scrap. It all will be calculated on the current market value of your vehicle on the date of theft/loss. The original worth of the car is not used for any calculation. Car depreciation insurance will make up for this gap. Car depreciation insurance is calculated by using trade publications. Other car insurers when calculating for the claims also use these publications.

Return to value GAP insurance
This type of GAP insurance is suitable for new cars that you have purchased from a dealer by cash or by finance. It pays back to you the amount lost in the depreciation of your vehicle. This means that you will receive the difference between your motor insurance claim given to you and the value of your vehicle when you purchased it.

Return to invoice (RTI)
RTI insurance fills the gap between the original purchase price of your car and the amount that your insurer is paying you in an event of total loss of the vehicle (which includes theft or damage, which cannot be repaired). A pre-requisite for availing this cover is that you must purchase your vehicle (new or old) from a dealer within 90 days of buying this policy cover.

Finance shortfall
This cover will fill the gap between an outstanding finance on your car and the insuring company’s valuation of your vehicle in the event of theft or terminal damage to it. You can compare car insurance quotes UK online for detailed information about the prevalent market quotes and which one will be the most advantageous for your vehicle.

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