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What is GAP Insurance for cars?


GAP Insurance for cars is also sometimes called GAP Coverage, Guaranteed Asset Protection (GAP), or Shortfall Insurance. With GAP Insurance, if your car is written off or stolen, you can top up your motor insurers' market value settlement to cover either an outstanding finance settlement or perhaps back to the price you originally paid for the vehicle.   Gap Insurance for older cars


There are different types of GAP Insurance as well. These can include:


Is GAP Insurance just for new cars?


Many people are under the impression that GAP insurance is only for new cars. This is not true. GAP protection can also cover older cars too! If you have an old car that has depreciated or lost a lot of value, a GAP Insurance policy may be able to help even if your car was not originally purchased brand new.


Your comprehensive car insurance will normally only cover the current market value of your car.


The bottom line is that anyone that owns a car can benefit from GAP Insurance cover. If your car has depreciated in value, then getting GAP protection may be exactly what you need to get back on track financially.


Is there an age limit for GAP Insurance for cars?


Most GAP Insurance policies will have a maximum age limit your vehicle can be on the day you buy the GAP Insurance policy. The age limit can differ from product to product.


Generally speaking, Vehicle Replacement GAP Insurance products are designed for new, or nearly new, cars. As such they often require that the vehicle is either new or nearly new, at the time of policy purchase.


Return to Invoice GAP is normally available for older vehicles. Many have limits of 8 years of age when the GAP policy is taken. However, at GAPInsurance123 we can cover vehicles up to 8 years of age at the GAP Insurance policy purchase.


If your vehicle is between 8 and 10 years old, with less than 80,000 miles, then if you are looking for Return to Invoice GAP, please try our sister website at


Why would I need GAP Insurance on an older car?


There could be an argument that an older car has already lost most of its value, so negating the need for GAP cover. However, there are a few compelling reasons why you may still consider buying GAP Insurance.


You bought a car on finance


Nowadays, leasing or financing a car is so common that the age of the car does not necessarily make any difference when considering GAP Insurance.


You would expect nearly all vehicles to lose value over time. This means you can still face a significant shortfall on a financial settlement if the car is written off.


GAP protection can help protect against this if the vehicle is written off.


Your vehicle, despite its age, can continue to lose value   Gap Insurance for older vehicles


It is generally accepted that a car will lose most of its value in the first few years of its existence. After this point, the loss in value tends to flatten out.


But, the majority of cars will continue to lose value as they get older. This can create a shortfall between the current value and the original price paid.


GAP protection can help protect against this if the vehicle is a write-off.


Older cars can be more likely to write off


When a car insurance company decides what to do, following an accident, they will assess the cost of any repairs as part of their investigations. They will compare the total cost of the repair against the current market value of the vehicle. If they deem the cost too high then the car can be written off.


The issue with older cars is that they are lower in value. The costs of repairs do not change, no matter the value of the vehicle.


So if you have £5,000 worth of damage on a £20,000 brand new car then your motor insurer will most likely repair the vehicle. If the very same £5,000 worth of damage occurs on an older vehicle then that vehicle will be written off.


Remember GAP Insurance can only be claimed if the car is written off following an accident, fire, theft, or flood.


GAP insurance for older cars can cover this shortfall in value, should it be needed.


How much does it cost to get GAP Insurance on an older car?


The good news is that GAP Insurance on an older car, relative to a new car, should not be any different. The GAP Insurance cost generally is determined by the purchase price of the car and the length of cover you want.


So a £15,000 new car or a £15,000 8 year old car should be the same cost to get the same GAP cover for.


Who would not benefit from GAP Insurance on their car?


GAP Insurance is a personal choice, not a mandatory requirement. That said, many people could potentially benefit when they buy GAP Insurance for their car.


There may also be some people who may not benefit from GAP cover at all, particularly with an older car.


The obvious car owner who may not benefit from GAP Insurance is someone who has either a Classic Car motor insurance or an Agreed Value motor insurance policy in place. In either car, the car insurance provider covers the vehicle for an agreed, fixed figure instead of the reducing market value of the car. In these cases, any write-off will see a car insurance settlement based on the agreed value, so negating the need for GAP Insurance as well.


Another type of car owner who would not benefit from any form of GAP Insurance is one who would not be impacted by a financial loss if the car was written off or stolen. Perhaps you would not have any outstanding finance balance to worry about. Perhaps you are not concerned about the cost of a replacement vehicle. In this case, GAP Insurance may not be for you.


Can you get GAP Insurance for older contract hire vehicles?


It is possible that you could find GAP Insurance for contract hire cover on older cars, indeed GAPInsurance123 will provide such Contract Hire GAP Insurance or Lease GAP Insurance for cars up to 10 years old. However, Contract Hire agreements tend to be on new, or nearly new cars, so it is unlikely you will need this type of finance cover.


Can you get GAP Insurance for cars over 10 years old?


In the current market for GAP Insurance in the UK, finding cover for vehicles over 10 years old is difficult. However, at that kind of age, a car with a good value is likely to be a classic and therefore qualify for a classic car insurance policy to a fixed value anyway.


New for 2023, GAPInsurance123 has introduced an annual, renewable policy called Top Up GAP Insurance. This is available for vehicles up to 15 years old and with less than 150,000 miles on the clock when you buy the policy. Top Up GAP is designed to 25% to your motor insurers' settlement if they write off the vehicle as a total loss, up to a maximum of £10,000.


GAP Insurance checklist


There are many types of GAP Insurance policies, and all will have terms, conditions and exclusions. You may want to check a few details before buying cover.  Gap Insurance for 10 year old cars


These can include:


How does GAP Insurance work?


Is it a form of Invoice cover that can take you back to the price you paid for your car if it is declared a total loss by your car insurer?


Is it a form of Finance GAP that can only cover a shortfall between the motor insurer's settlement and the car finance company's settlement?


Does the policy have a claim limit? If so, how much?


This is the maximum the GAP adds to the motor insurance payout if the car is declared a total loss.


Does that policy require the vehicle to be bought from a car dealership or will it cover cars bought from a private seller?


Many products are only eligible if you buy new and used cars from a car dealership.


Will it cover a car finance agreement if you are in negative equity?


This is where you use a finance deal to buy the car, and when you make a GAP Insurance claim you owe more on the finance settlement than the value of the car. Our GAPInsurance123 cover can help protect you from this. However, where you carry over negative equity from one finance agreement to another, this is not covered by the products we provide. There may be other providers who have specific negative equity GAP Insurance cover that can help protect these situations.


Is the GAP policy provided by a company authorised and regulated by the Financial Conduct Authority?


Is the company registered with the correct regulations to provide you with all necessary protections in the UK?


Do they have a Firm Reference Number (FRN) with the FCA that you can check?


An easy check on the Financial Services Register.


Is the policy covered by the Financial Services Compensation Scheme in the UK?


You would expect this protection with many financial products in the UK but it is best to check you qualify for cover.


Are there any specific requirements for additional protection of your vehicle?


An example would be where you are required to fit an approved tracking device for a vehicle over a certain value.


So there you have it. A rundown of how to get GAP cover for older cars and what to look out for. We hope it helps. If we can assist any further please just let us know.


How long do you need GAP Insurance for?


This really depends on you, and your intentions with the car in many ways. If you have taken a finance agreement over 60 months then you may be tempted to consider GAP Insurance for car loan for the full term. However, 5 year GAP Insurance is quite rare, especially for the higher levels of cover like Return to Invoice or Vehicle Replacement GAP. Indeed GAPInsurance123 can provide GAP cover for 5 years.


When deciding how long you want to take out cover for there can be a temptation to match the length of any finance agreement with the length of GAP Insurance cover. However, if you are not intending to keep your vehicle for the full length of your finance agreement do you really need GAP cover for longer?


The choice is yours.