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What is GAP Insurance?

Guaranteed Asset Protection (GAP) Insurance protects you against financial loss if your vehicle has been declared a total loss or write-off by your insurer. A GAP Insurance policy will top up an insurer’s pay-out, providing the extra funds to purchase a replacement vehicle or to settle any outstanding finance. 


Why have GAP Insurance? 

As soon as you drive your vehicle off the forecourt, your car’s value will immediately begin to depreciate. GAP Insurance covers the difference between the price you paid for the car and its current market value, essentially it covers the “gap” providing the funds required to replace the car.  

Depreciation is an unfortunate reality that almost all car owners must take into account. On average, a car loses around 60 per cent of its value in its first three years. So, if your new car costs £12,000, and three years later it was stolen or written off, you’d get just £4,800 from your insurer.

That’s not enough to buy the same car brand new and, if you purchased the vehicle with a finance plan such as PCP (Personal Contract Purchase), it’s unlikely to be enough to repay any outstanding balloon payments and interest on your PCP plan. 

Don't let car depreciation catch you off guard. Choose the right GAP Insurance plan for you today.


Why Does Depreciation Impact My Potential Insurance Claim?

It’s likely that your insurance policy will only pay the current market value of your car in the event of a write-off. This means that you’re probably looking at a payout that’s significantly short of the sum you originally paid for your car.

Consequently, if you purchased your car for £40,000 and need to make a claim three years later, you could be looking at a payout of just £14,000, assuming the value of the car has depreciated 60% in three years. This would potentially mean you’d have to find £26,000 on top of your insurance payout to buy a new like-for-like replacement, which would likely leave you out of pocket.

MotorEasy GAP Insurance protects you against this scenario, covering you for the car’s value at inception by increasing in value over time as the value of your car depreciates. It’s a great way to offset depreciation and ensure that you don’t find yourself facing a huge bill to replace your car.


Types of GAP Insurance 

There are five main types of GAP Insurance for cars:


Return to Invoice (RTI) 

A Return to Invoice (RTI) GAP policy is available for both new and used vehicles bought from a VAT-registered dealer in the last 6 months. It applies to used cars under 10 years old with less than 100,000 miles. 

This policy makes up the financial gap between your vehicle's purchase price and your car insurer's payout, or it can cover the remaining finance balance if it's higher. 

For leased vehicles, it pays the difference between your insurer's settlement and the lease company’s early termination fee. Secure a quote for comprehensive protection and reassurance on the road.




Return to Value (RTV) 

RTV GAP policies are available for vehicles purchased through a private seller, or new and used cars purchased through a VAT registered dealer more than 6 months ago. 

Your car must be under 10 years old and must have covered less than 100,000 miles.

An RTV policy covers the difference between the value you paid for the vehicle and the market value of the vehicle on the start date of the plan. Grab RTV GAP protection in seconds.


Finance GAP Insurance 

Finance GAP Insurance is a standard feature within various GAP policies, addressing the shortfall between your vehicle's value at write-off and your remaining finance dues. However, it doesn’t cover scenarios where your loan surpasses your car's value, like when rolling over debt from a previous vehicle part exchange into a new finance agreement. 

Be aware that any prior outstanding balances from past agreements won't be covered under new finance or hire purchase.


Vehicle Replacement GAP Insurance (VR) 

Vehicle replacement GAP Insurance is designed to protect you from future increases in car prices or discounts that are no longer available.  

It is designed to compensate for the difference between your car Insurance pay-out and the future cost of replacing an equivalent vehicle with a new one. Given the replacement costs for some vehicles can be lower or the same, vehicle replacement GAP Insurance may not be relevant in all situations.


Contract Hire GAP (CHG) 

Designed for leased vehicles that you do not own - in most cases, contract hire GAP Insurance will pay any outstanding rental payments or a termination fee as well as any shortfall in the market value remaining above your main insurer’s payout.



Don’t leave your financial well-being to chance. Explore your GAP Insurance options now and safeguard your future against unforeseen financial gaps.

What’s covered by GAP Insurance? 

Your GAP cover depends on the type of policy you selected and will be shown in your schedule of cover.  

For example, if you purchase a MotorEasy RTI policy, if your vehicle is written off due to fire, theft, accidental damage, or adverse weather conditions, MotorEasy will cover:


  • The difference between the motor Insurance settlement and the net invoice price you originally paid for your vehicle; or
  • The motor Insurance settlement and the amount required to settle your outstanding finance balance, depending on which amount is greater;


  • If you have purchased your vehicle under a lease agreement, this policy will pay the difference between the motor Insurance settlement and the lease early termination charge required by the lease company
  • We will also cover up to £1000 of your motor Insurance excess

What is NOT covered by GAP Insurance: 

  • GAP Insurance will not cover the cost of your main car Insurance premium. It also excludes any deposits, discounts, rebates, concessions, cashback and incentives that you may have benefited from, when you first purchased the vehicle.
  • It excludes the general costs associated with getting your vehicle on the road, for example, new vehicle registration fees, road fund licence fees, and the cost of a number plate.
  • Also excluded are any additional costs you may have taken out when you first purchased your car – for example, if you purchased a dealer warranty or paintwork protection, or benefited from a free tank of fuel.


Who needs GAP Insurance?

GAP Insurance is ideal for cars up to 10 years old or with less than 100,000 miles, especially new ones that depreciate quickly—up to 60% within the first three years. 

It's particularly valuable for those with finance agreements featuring low initial payments and extended repayment terms, as the owed amount can often exceed the car’s depreciated value, leaving a significant gap to cover in the event of a write-off.

Don’t wait for the unexpected; secure your car’s value today. Explore our tailored GAP Insurance options and find the peace of mind you deserve.


Who doesn’t need GAP Insurance? 

Some car insurers may replace a new car for free if it's written off within the first year, so check if you're covered before opting for GAP Insurance in this period. 

It isn't necessary for cars over 12 years old as they've likely depreciated fully. It's most relevant for new car purchases, particularly those with small initial payments. 

If you've made a substantial down payment, say 20% of the car's value, the need for GAP Insurance diminishes, as you're less likely to face a significant finance shortfall if your car is written off.


What are the benefits of GAP Insurance? 

GAP Insurance offers peace of mind for newer vehicles (1-3 years old) at risk of high depreciation. The insurance ensures that you're not left out-of-pocket if your car's insurer's write-off payout is less than your car's purchase price or the cost of a similar replacement. 

It's particularly useful for financed cars with small down payments and long payoff periods, where the car's market value may fall below the outstanding finance amount. It prevents the financial strain of repaying finance on a car you no longer have and provides quick funds for a replacement or cash in hand.

In addition to the direct financial protection that GAP Insurance affords, a MotorEasy GAP policy also provides several additional benefits, including:


  • Up to £1000 in motor Insurance excesses covered
  • Optional extras and accessories covered (where factory or dealer fitted)
  • Covers European road trips
  • Savings on MotorEasy maintenance and repairs
  • FREE MotorEasy account with access to all your car’s details, documents, important reminders and motoring offers
  • Covers most manufacturers 


How much does GAP Insurance cost?  

The cost of your GAP Insurance will depend on your age and the make and the model of the vehicle. Going to MotorEasy for GAP coverage is up to 75% cheaper than purchasing through the dealer or a lender. You can choose a MotorEasy GAP policy from 24, 36 or 48 months.

Example of pay-outs:

  • 5-year-old BMW 3-Series - £3408
  • 20 plate Nissan Qashqai - £3010


Does GAP Insurance make financial sense?

It’s easy to hope for the best and dismiss the possibility of a write-off as unlikely, but it’s actually far more common than many people think - almost half a million cars are written off in the UK every year, that is 1,000 each day, and one every minute and a half.

Car insurance is supposed to provide peace of mind, so it’s disappointing to discover that most policies are found wanting when it comes to the crunch. It’s wise to contemplate the worst-case scenario and protect yourself against it, which is precisely what GAP Insurance is designed to offer.


How do I get a GAP Insurance quote? 

Simply enter your registration number and some other personal details and you’ll be presented with a quote in seconds! If you’d prefer you can always give us a ring on 0800 131 0001; calls are free, and we can then go over any specific requirements you may have for your vehicle.


Get a quote

How do I claim on GAP Insurance? 

As soon as you think the insured vehicle may be declared a total loss, you should immediately review and proceed with the claims process found in your policy document – you’ll find this in your MotorEasy account. Make sure you do this before you accept any settlement offer from your motor insurer.

Contact MotorEasy within 60 days by telephone at 0800 131 0001 or email, it's that simple! 


GAP Insurance FAQs

We've put together a list of frequently asked questions to make car ownership less confusing. 


Will GAP Insurance replace my car? 

GAP Insurance covers the gap between your main insurance payout and the amount you paid for your car (return to invoice) or its present market value (return to value). This insurance ensures you can replace your vehicle or clear any outstanding finances in case of a total loss.



Is GAP Insurance worth the money? 

GAP insurance can be a valuable investment, particularly if you're concerned about the financial impact of your car being stolen or totalled. It's crucial, though, to shop smartly, as dealer-sold GAP policies may cost up to three times more than those from independent providers like MotorEasy. 

Following a 2015 FCA regulation, car dealers must observe a two-day cooling-off period before offering GAP insurance, although customers can waive this if they wish. When considering GAP insurance, pay close attention to the policy's scope, noting any limitations, exclusions, or potential excess charges, and don't hesitate to reach out to the seller to understand the finer details.

What is the difference between a vehicle Replacement GAP policy and a Return to Invoice GAP Policy? 

While a return-to-invoice GAP policy will pay you back the price you paid for a vehicle, a vehicle replacement policy pays up to the cost of a replacement car, or your finance settlement, whichever is greater.


How long does GAP Insurance last?

A GAP Insurance policy will typically last three years, however, it is dependent on the policy you choose. GAP cover direct from a dealer could be shorter - generally one year.


How do I know if I have GAP Insurance?

If you’re not sure whether you have GAP Insurance, you should check your Insurance and purchase or finance documents. If you’re unable to find any information, contact your Insurance provider and car company to ask.


How does GAP Insurance work with PCP?

A personal contract purchase, known as PCP, is a popular way of financing a car. GAP Insurance for cars on PCP will cover the difference between your Insurance payout and the outstanding finance, including balloon payments.


Can I get GAP Insurance on a business car?

Yes, it’s available on business and personal vehicles.


Who is the underwriter for the GAP Insurance policy?

MotorEasy GAP Insurance is unwritten by Helvetia Schweizerische Versicherungsgesellschaft.


Is MotorEasy regulated by the FCA?

Yes, GAP Insurance from MotorEasy is regulated by the Financial Conduct Authority (FCA).


Am I covered with GAP Insurance if hit by an uninsured driver?

Yes, you’re covered with GAP Insurance as long as you have a comprehensive Insurance policy.


This concludes our comprehensive GAP Insurance guide. Still have questions? Get in touch with our friendly team.