Customer Service Lines Open Mon-Fri 9am-6pm
Closed Saturday & Sunday & Bank Holidays
Since GapInsurance123 was launched three years ago we have seen only a few changes in the online Gap Insurance marketplace. The same names that were around then are pretty much the same as you will find now, except with the welcome addition of a couple of new names, such as our Shortfall.co.uk sister brand in 2013.
It is fair to say that a competitive market normally will drive down the cost of comparable products, and this is great news for the consumer. Indeed this has always seemed to be the case, and comparable prices have certainly come down since we entered the market in 2011..................perhaps until recently.
We have seen a growing trend with some online brands to actually raise the costs of their premiums to consumers. Of course they may never admit that they have raised prices at all, and may hide behind a knowing 'nod and a wink' sales approach, trying to persuade you that their products are more expensive simply because they are better?
Are they right?
Well we have seen some bold claims such as 'we have the best policies in the market, and we can prove it'. The problem is they seem to forget to provide any evidence on exactly why they provide better cover. We did find a vague clause that said you would get your road tax back, however since 1st October 2014 the DVLA will automatically refund outstanding road tax in the event of a total loss anyway.
We would suggest this 'benefit' may be about as much use as a chocolate tea pot!
We have seen other brands that use the 'high price' premium approach say that they use an underwriter domiciled in the UK, and this is somehow better than one based in Gibraltar as Enterprise Insurance Company PLC are. However what they fail to tell you is that Enterprise Insurance Company PLC provide cover for a number of the leading independent Gap Insurance brands in the UK, as well as AA Warranty branded products in motor dealers. So basically there are hundreds of thousands of these Gap Insurance products sold and with the power of the internet we can assure you that if there were any issues with claims you could easily find out about it.
Does a Gibraltan based insurer worry customers of the likes of Admiral and Saga? Just like customers of those major motor insurance names, all of our claims are handled in the UK, and the policies are covered by both the Financial Ombudsman Service and the Financial Services Compensation Scheme in the UK also.
Of course our sister Gap brands Easy Gap and Shortfall.co.uk use a UK based underwriter. The approach of our company, unlike some of our rivals, is not to tie ourselves to an exclusive agreement with any one insurer. We are perfectly placed to know how our claims are handled, and of course if we were unhappy we could change our underwriters. However the fact that we have maintained our relationship the same since 2011 should tell you all you need to know.
So if the products are the same, why do some providers insist in premiums higher than they should be?
The simple answer is volume. We are able to structure our prices based on the volume of products we sell. This is the basic fundamental of many business models, and is the same of insurance. Our underwriters are more likely to provide us with better product features and premium rates if we can provide a high volume of sales.
The unique position of Aequitas Automotive Ltd is that we have three of the leading six to eight brands in the market. This includes the GapInsurance123 brand which resides at the top position in Google for the search term Gap Insurance. All this means that our sales volume increases 45-50% year on year. Interestingly we have seen an increased trend of acquiring former customers of our competitors, all of which seem to be taking the 'high price' premium approach these days.
You see we do think that product features are the most important factor in a policy. However, as many of the brands in the market use the same insurers anyway, we cannot stand here and say our products are so much better than anyone else. The truth is there are many good products in the market now, and if you choose not to buy from us them you will probably still buy a quality product (even if you pocket is a little lighter!)
Ensuring the quality of our products is essential, but in accepting that we do this we do understand one other factor is key. In a recent survey of internet insurance buyers, customers were asked which factors were most important to them in choosing their insurance. Some factors such as tailored products were highlighted by 24% of people, claims process 30%, and breadth of cover 61%, but by far and away the biggest deciding factor was price at 85%.
The message is clear, savvy consumers are looking for the best value, and premium price is the biggest factor in this.
So whilst some of our rivals continue to raise prices we will make the following commitment. As the number of customers we attract to GapInsurance123 continues to grow, the increased revenue this brings will be used to lower our premiums in the future. We see Gap123 products already 35%-40% cheaper than some of the leading online rivals now. It is our aim to provide what the consumer wants, and we could see this 'Gap' grow still further in 2015.