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What is Gap Insurance?

Find out all about gap insurance, whether you need it and how PSA Insurance Solutions can help today.

What is Gap Insurance?

 
Guaranteed Auto Protection Insurance, or better known at Gap Insurance, is an optional, add-on car insurance coverage designed to help certain drivers cover the gap between the actual cash value of their car and the amount they owe. If an accident occurs or your car is stolen, car gap insurance can prove very beneficial to the insured driver of the car, particularly if the vehicle is being paid off on finance. It is important to remember that the actual cash value of the car is taken from the car’s worth at the time of the accident, which might be significantly less than the price that was originally paid for it – therefore causing a ‘gap’ to form between how much was paid for the car and the amount your insurance company will pay out, should the car need replacing. So, should you be ‘insuring the gap?’ – read ahead now to find out a bit more about the benefits that you can experience, when you decide to take the plunge and take out gap insurance.
 

Why might I need car Gap Insurance?

 
When there are so many options for insurance on the market, covering a whole host of different things, understanding whether you actually need gap insurance can be a little tricky. However, choosing to buy gap insurance is ensuring that you are covered for the full price of your car, should it get stolen or written off and need replacing. Because the main insurer of the vehicle in question are likely to only pay out the value of the car at the time of the incident, there will be some sort of gap that, without gap insurance, you will have to cover out of your own finances. Generally, price of a brand-new car will often decrease by a 1/3 the moment that it is driven from the showroom. This makes gap insurance a worthwhile consideration for any new car driver. Car depreciation does depend on how old the car is, how many miles it’s done and the model of the car, so will vary from vehicle to vehicle.
 

It is important to remember that the actual cash value of the car is taken from the car’s worth at the time of the accident, which might be significantly less than the price that was originally paid for it.

 

What are the benefits of having car Gap Insurance?

 
The main benefit of having car gap insurance is that it makes buying a replacement vehicle quickly much more achievable, because you won’t have to find the money to make up the difference in cost. With gap insurance companies such as PSA Insurance Solutions, you can put the incident behind you and get on with what really matters; finding your new car and getting back on the road. Gap insurance is particularly useful if you:
 
  • Want a brand-new car
    If you’re looking to buy a brand-new car, then gap insurance is something definitely worth considering because, as explained before, you will then be covered for 30% of the ‘gap’ between what you paid for the car and the car’s current value should your car be written off or stolen.
  •  
  • Owe a finance company
    If you have borrowed money from a finance company to purchase your car then you may find gap insurance useful because if something does happen to the car, you will still owe money at the rate of the original price of the car. Taking out car gap insurance is a great way to cover the rest of the costs when your insurance only pays out at the car’s current value.
As well as the above, a priceless benefit of gap insurance is simple peace of mind – knowing that if anything was to happen, you are covered financially and won’t be left high and dry if you unfortunately suffer a total loss of the car from an accident or theft.
  

What does Gap Insurance from PSA cover?

 
PSA Insurance Solutions’ car gap insurance product has policies available for both new and used vehicles and works to cover the gap between the motor insurer’s market valuation and the original invoice price of the car. The cover can be renewed up until the car is not more than 8 years old, depending on the options you choose when you purchase the policy. By taking out gap insurance with PSA Insurance Solutions you are covered for 30% of the market value of your vehicle in the event that you suffer a total loss. The maximum amount paid out by a gap insurance policy from PSA is capped at €22,500.
 
Gap insurance is quite versatile and tends to cover:
  • Theft, in the event of your car being stolen and not recovered within 30 days. 
  • Negative equity, the gap between your car’s value and what you owe on your loan/finance.
Please note that gap insurance is only used in the event of the total loss of the car, whether that is through theft or accident damage. Provided that the total loss of your vehicle is covered by your car insurer.
 

Getting a Gap Insurance Quote

 
Getting gap insurance from PSA Insurance Solutions online is simple; by heading to the website and opting to get a gap insurance quote, you will be covered in no time at all. Navigating our online form is easy, simply enter your registration number or vehicle brand into the boxes provided. Please note, if you do only enter the brand of your car, you will receive a quote that is indicative. In order to proceed and receive a car gap insurance quote or a car finance gap insurance quote, you will need to answer a few questions about your current car insurance policy, to ensure that it fits the requirements. After this, you will receive a personalised gap insurance quote from PSA’s experts. This automated process is super simple and can be done easily from home, meaning you’ll have your gap insurance quote in no time at all.
 

Buying Gap Insurance Online

 
Once you have received your gap insurance quote, buying the insurance online is a quick and easy process. There are many benefits to buying gap insurance online, one being that you are often likely to find a much cheaper deal for the same cover than if you were to buy gap insurance from a dealership. Buying your gap insurance online will bring you that all important peace of mind when it comes to driving, knowing that your finances are protected, should anything happen to your car. At PSA, we understand the financial commitment owning a vehicle can require and with our gap insurance policy there are no hidden costs and fees and with a simple premium, peace of mind is just a click away.
 
 
 

Do yourself a favour. Put your mind at rest.

 
 
 
 
 

Do yourself a favour. Put your mind at rest.

 
 
Additional Reading
How will Gap Insurance work for me? 03 May 2019
Different Types of Gap Insurance 30 April 2019
© PSA Insurance Solutions
PSA Insurance Solutions Ltd Reg No: C83206 is a limited liability company under Maltese Law, having its registered address at: MIB building 53 Abate Rigord Street Ta’ Xbiex Malta, Tel + 356 22 58 34 92. The company is enrolled to act as an insurance agent in terms of the Insurance Intermediaries Act, 2006 by the Malta Financial Services Authority (MFSA), Notabile Road, Attard BKR 3000, Malta.
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