Finance, Lease & Contract Hire gap insurance protection

In the event of your vehicle being declared a Total Loss, our finance, lease and contract hire gap insurance will pay the difference between the outstanding finance balance and the settlement you receive from your motor insurer. .

Cover will include up to a maximum of £250 motor insurance excess.

The purchase price is the actual invoice price that you pay for the vehicle, deduct any discounts but do include all factory fitted accessories and up to £1,500 of dealer fitted accessories and paint protection applications up to £500, OR the vehicle value (whichever is the lower).

You should exclude any additional payments for warranty charges, insurance premiums, finance charges, cost of fuel and negative equity from a previous vehicle.

The Claim Limit is the "top up" difference between the vehicle value at the point of total loss and the amount required to settle the outstanding finance.

YES, we will insure your initial deposit up to £2,000.  This is an optional add on.

Policy documents together with confirmation of payment are sent by email as soon as you make the payment.

Only your insurer can declare the vehicle a total loss which in general can result from accidental damage, your fault or third party fault, fire, theft or vandalism.

Total loss means that you have claimed under your motor insurance, your claim has been agreed, your vehicle has been forfeited (title of the vehicle transferred to the motor insurer) and a payment made following the incident.

This policy can be purchased at any time.

It can either be a single one off payment with the use of a credit/debit card without any card charges or alternatively we can arrange for credit payments over 12 months. Please note that the payments are collected by a third party agency and a small administration fee applies.

The policy should always be in the name of the owner/ hirer or registered keeper of the vehicle.

When it comes to getting a new car, finance, lease and contract hires are proving an increasingly popular option up and down the country. But what happens if your vehicle is declared a total loss, leaving you with a significant amount left to pay on your finance deal?

That’s where our contract hire gap insurance comes in. As just one of the types of cover we offer, our finance gap insurance is designed to protect you from suffering a significant shortfall in the event of your car being written off. 

Because the value of your car at the time of being declared a total loss will be different to when you first bought it, your motor insurer will offer you a settlement in line with its current worth, rather than the value at the time of purchase. Recent research shows that the average car depreciates by as much as 60% in its first three years which, if your car was written off, could leave you with a significant deficit to pay on your finance agreement. That’s a situation that nobody would relish, which is why our Finance, Lease, Contract Hire, PCP gap insurance is worth considering as a sensible option to mitigate any damaging costs if the worst was to happen to your car.

Let’s say that at the point where your car is declared a total loss, you owe £20,000 on your finance agreement. However, due to depreciation and other factors, your car at that stage is only valued at £14,000, which is the settlement you receive from your motor insurance provider.

That leaves you with a hefty £6,000 shortfall on the finance agreement – an amount that you may not be able to come up with. But by taking out finance gap insurance with Direct Gap you’ll have protected yourself, as your policy will ensure that we’ll cover that £6,000 deficit.

Yes , our finance and contract hire gap insurance policies are extremely flexible and cover all types of finance contracts.

Contract hire is specifically covered under this policy as it recognises you may not be the registered keeper of the vehicle, but the hirer.

If your vehicle is written off and you have taken out contract hire gap insurance, the next steps will be as follows:

1. Your motor insurer will confirm your car is a total loss.
2. A settlement figure is requested and subsequently received from the provider of your finance agreement.
3. Direct Gap will then pay the difference between the motor insurer’s settlement and the total finance remaining on the vehicle, ensuring that you have nothing to pay.
4. If you have chosen to purchase deposit protection as an add on to your main finance gap insurance policy, your deposit will be refunded up to a maximum value of £2,000.

It’s not a requirement to take out contract hire gap insurance but, as highlighted in the example above, it could prove a shrewd financial decision if your vehicle was to be declared a total loss.

If your car was written off and you had not taken out a Finance Gap insurance policy, you could be left with a significant amount outstanding on your agreement, which you would have to pay for out of your own pocket.

If misfortune was to strike and your car was declared a total loss, you could be left with a large amount outstanding on your finance agreement. That’s because a motor insurer’s settlement will be in line with the car’s value at the time of the incident, rather than its worth when you originally made the purchase.

If you come to us for your finance gap insurance, we’ll cover that shortfall on your agreement. Without gap insurance, you’d have to make up that deficit out of your own pocket, which could prove expensive.

If you’ve bought your car via PCP, choosing between our range of products will depend on your specific circumstances – there is not necessarily one solution that will suit all.

For example, our Finance/Contract Hire gap insurance may be most appropriate if you have put down a minimal deposit, as it will cover the difference between the outstanding amount of finance remaining on your agreement and the value of the car at the point where it was declared a total loss.

Or, our Vehicle Replacement +  gap insurance will pay the difference between your motor insurer’s settlement and the cost of a replacement car, matching the original specifications of the vehicle.

If you’ve put down a sizeable deposit on your car, our Return to Invoice + gap insurance may be the preferred choice, as it will cover the difference between your insurer’s pay-out and the purchase price of your vehicle. Whatever your situation, here at Direct Gap we’re committed to providing the solution that best suits your requirements.

Yes; up to £250 in the event of a total loss claim.

Yes; you are covered when keys are stolen from your home or office which results in vehicle theft. However you must exercise due diligence and take appropriate steps to safeguard both the keys and the vehicle.

No insurer, including your motor insurer, will provide cover for wilful negligence. For example if you leave the keys in the vehicle and you go off to pay for fuel which results in the vehicle being stolen.

Please see the policy terms and conditions for a full listing, however the main exclusions are:
The vehicle becoming a total loss whilst the driver is under the influence of non prescription drugs or under the influence of alcohol, involved in illegal activity, fraud or an act of wilful negligence, eg leaving keys in the ignition whilst the vehicle is unattended.

We are an internet based provider and as such we have lower overheads than motor dealers.

As a result of the high volume of GAP insurance that we sell annually, we are able to provide quality policies at the keenest prices.

You can be confident that our prices are lower than those quoted by dealers and many other web sites.

Paying less than you have been quoted elsewhere in no way means that you are buying an inferior product, it just means that they are making more profit from your purchase!

Yes; GAP insurance will include all drivers provided that they are covered on your comprehensive motor insurance policy to drive the vehicle as a named driver.

You are covered not only in England, Wales, Northern Ireland, Scotland, Isle of Man and the Channel Islands but also in member countries of the European Community and any other country for which an International Motor Insurance Certificate (Green Card) is effective on your vehicle at the point of Total Loss up to 120 days in any one trip.

It can either be a single, one-off payment with the use of a credit/debit card without any card charges, or alternatively we can arrange for credit payments over 12 months. Please note that the payments are collected by a third-party agency and a small administration fee applies.

Brexit takes place on 31 January, and the UK will no longer be member of the European Union. Many arrangements will stay in place for a transition period whilst a deal between the UK and the EU is negotiated.

The current advice from the UK government is that during the transition period (until 1 January 2021) arrangements for driving in EU countries remains unchanged.

At the end of the transition period you will need to get yourself an International Driving Permit and a green card to ensure your insurance is valid. You will also need a GB sticker for your car.

Note that Brexit does not affect gap insurance. Your gap insurance policy will still be valid if you drive in Europe - however you do need to be covered by a fully comprehensive cover for the policy to be valid in the first place and this will require a green card from your insurer.

https://www.gov.uk/visit-europe-1-january-2021

Where do I get an International Driving Permit?

International Driving Permits can be obtained from the Post Office. You will need a passport photo and your driving licence. Currently different EU member states require different length permits for non-EU drivers - for instance Spain requires a one year permit and Germany a three year. If you are touring the EU you should get both to be on the safe side. 

How much do International Driving Permits cost?

The International Driving Permit costs £5.50 pre document (you may need two if you are driving between countries with different requirements).

How do I get a green card?

You will need to call your insurer before you set off, let them know the exact dates that you require it for. And (naturally) they will charge you. 

Whilst the government advice is to allow a month to receive the green card, our advice from our insurer is that you don’t actually need the bit of paper to travel, they’ll have a note of it if anything unfortunate happens. It is currently not clear whether you will need to carry your green card for examination by the authorities