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I was really surprised at how well the new laws work with dealers not being able to push GAP, and all the other services they use to make a hefty mark up on! As a sensible person purchasing a car either on PCP or a bank loan I have always considered gap insurance and paying £35k for a new car decided to take it out once again..
I had previously took GAP on my px and reading the small print was surprised I could transfer this from vehicle to vehicle as long as it was a higher costing vehicle.
I ended up paying for total loss GAP due to the cost of car and paid £199. As my old policy was on a different GAP product they cancelled this and refunded 85 quid, somin effect paid £109 for 4 years cover.

I used totallossgap.co.uk and the service was second to none. Would highly recommend!
 

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poejay said:
I was really surprised at how well the new laws work with dealers not being able to push GAP, and all the other services they use to make a hefty mark up on!
Sadly, we're not getting the same impression overall.

In fact, aside from hearing of a number of ways dealers have attempted to flout the 'new' rules, we ask everyone buying GAP insurance for the name of their supplying dealer and how much that dealer quoted them for GAP insurance - there's definitely an upward trend in the cost of GAP insurance from motor dealers and still what appears to be a "see-how-much-they-can-get-away-with" approach to their pricing model (e.g. people being quoted vastly different prices for the same cover, based on the similar valued vehicles by dealers within the same group).

We take the view that the new laws haven't been as effective as the FCA intended. It'll be interesting to see what (if anything) the FCA do in response (particularly given that their initial suggestion in their original market review was to consider entirely banning dealers from selling GAP insurance after they estimated they'd been over-charging to the tune of £76m per year) - though how long they'll take to do anything is another matter altogether.
 

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You'd think after the banks got crucified with having to pay PPI refunds, other industries flogging over priced insurance would be a bit more wary (I'm referring to the motor trade, not reputable businesses like gapinsurance.co.uk, BTW)
 

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AndyM said:
You'd think after the banks got crucified with having to pay PPI refunds, other industries flogging over priced insurance would be a bit more wary
That would be a perfectly reasonable assumption AndyM. Alas, the prices that some dealers are trying to charge for GAP insurance even since the new rules came in to force, is eye-watering.

However even free/discounted GAP insurance from a Motor Dealer should be approached with caution.

I've just recently spoken to someone who was offered Invoice GAP insurance by their motor dealer for £824... To add insult to injury, after rejecting the dealer's offer, the customer was told they'd supply their GAP insurance policy free of charge - a bonus, you'd think! Without thinking to mention it to me/us first she went for it, then called us to cancel the policy she'd had on the vehicle she was part-exchanging.

When quizzed, it turned out that the motor dealer's invoice showed that she'd paid £824 for the GAP insurance (they'd taken the discount off the cost of the car, rather than the policy itself). Most people wouldn't think much of this (the discounted was granted, what does it matter exactly how it was granted etc?) but given that it was an Invoice GAP insurance policy covering her to the price that she'd paid for the vehicle AFTER discount, she was in line to be £824 out of pocket at the time of any subsequent claim.

She now has the option of cancelling the £824 Invoice GAP insurace policy from the dealer, receiving a refund and then buying superior Replacement GAP insurance for the same duration for a premium of just £211.

In short... there is rarely occassion when sourcing GAP insurance from a Motor Dealer should be viewed in a positive light.
 

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Following up on this post... we now have a blog article discussing the experience of the customer I referred to in my previous post.

After cancelling the GAP insurance policy the dealer claimed they provided free-of-charge to her, she ended up with us supplying superior Replacement GAP insurance cover for a longer duration AND circa £455 back in HER pocket!

Read the blog article here
 
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