GAP Insurance

Compare GAP insurance quotes for your car, van, motorbike and motorhome [1]

What is GAP insurance?

Guaranteed Asset Protection (GAP) insurance covers the shortfall if your vehicle is declared a total loss or write-off by your insurance provider, but the payout is less than you paid for your car, van, motorbike or motorhome.

Your motor insurance provider will only pay out the current market value of your vehicle, which will probably be a lot less than what you paid for it because of depreciation. This is the case even if you bought it recently.

GAP insurance can cover that depreciation, so you can afford to buy another vehicle at the same value you bought your last one for. It also means you won’t be stuck paying off finance for a motor you no longer have.

GAP insurance is common with new vehicles, but you can also get GAP insurance on used cars, vans, motorbikes and motorhomes. Although you may want to consider whether it’s worth it financially.

Should I get GAP insurance?

Vehicles depreciate fast. That means, if yours is stolen or written off the insurance pay out at market value might not be enough for you to replace it with something similar, or even to pay off any finance you took out to buy your vehicle.

For example, if you bought a motor on finance three years ago for £20,000 and it depreciated by 60% in those three years, its current market value is £8,000.

If this vehicle is then written off, your insurer would pay you the market value of £8,000 (minus any excess), so you’re £12,000 out of pocket. GAP insurance would cover that £12,000 so you can get back to driving a brand-new car, van, motorbike or motorhome.

what is gap insurance for cars?

How much is GAP insurance?

If you buy a GAP insurance policy from the car dealer, you could be paying more than you need to, with prices ranging from £300 upwards.

Buying separately from the dealership could cost around £150 to £300 for a three-year policy, but generally the more expensive the motor, the more expensive your cover will be.

GAP insurance is usually paid for upfront. When you’ve just paid for a new vehicle the last thing you want to do is pay for additional cover, but you should consider how you’d feel if you couldn’t get back the full cost of your car, van, motorbike or motorhome.

If you do decide to purchase, it’s best to shop around because not all insurers provide the same level of cover.

According to research conducted by What Car? in August 2021, car dealerships were charging up to £218 more than independent insurers.

The good news is that car, van, motorbike or motorhome dealerships aren’t allowed to sell you GAP insurance at the same time as you buy a vehicle from them anymore - the Financial Conduct Authority (FCA) requires buyers to have time to shop around. Specifically, you must have a ‘pause in sale’ of two days.

Use this pause to compare policies and find the right fit for you without any pressure.

How does GAP insurance work?

If you have an accident that makes your vehicle unusable, first get in touch with your insurer and get the vehicle declared a total loss.

Once this is done – and before you accept any settlement your insurer has offered – contact your GAP insurer. Negotiations may be debated between both insurers instead of you acting as go-between.

If you’re happy with what’s been agreed, sign and return the forms they send to you and be prepared to provide supporting documents, like your MOT certificate.

You should first complain to the insurers if you’re not happy. If the issue isn’t resolved to your satisfaction, you can get in touch with the Financial Ombudsman who will look into it for you.

Protect your car, van, motorbike or motorhome with GAP insurance from i-Wonder[1]

Buy GAP insurance

Do I need GAP insurance?

GAP insurance provides additional financial peace of mind if your vehicle's written off, but it doesn't suit everyone. 

It might be right for you if:

  • You took out finance to buy your vehicle
  • You’ve bought a motor that depreciates quickly, especially a new one
  • Your vehicle is leased or on a contract hire deal

But you might not need it if:

  • Your motor is less than a year old and your insurance includes new vehicle replacement cover
  • You’d be satisfied with a like-for like replacement for your vehicle at its current market value
  • You have a used motor that depreciates more slowly

Before taking out a GAP policy, make sure you can afford the price of the premium on top of your regular insurance cover, as well as any possible monthly loan or leasing fees.

What are GAP insurance exclusions?

Watch out for these common exclusions:

  • Your GAP insurance will only pay out if you have comprehensive insurance
  • Your car, van, motorbike or motorhome must be confirmed as a total write-off, and you’ll only receive payment after your claim has been successful
  • It won’t pay out if your vehicle was written off due to drink or drug-driving
  • Nor will it pay out if someone else was driving the wheel (or handlebars) without a valid driving licence
  • It won’t pay the difference if you underestimated the value of your vehicle when taking out GAP insurance
  • It won’t cover any non-standard modifications you make to the vehicle after purchasing it
  • A GAP insurer may not provide cover if you pay over a certain annual value for your insurance - read the small print closely
  • There’ll be limitations around the number of miles the vehicle has done, its age and how much your vehicle is worth. Check the terms and conditions carefully

Selling your old car?

Get a free online valuation to see how much it's worth

Sell my car

Tools and calculators

Page last reviewed: 20 February 2023
Page reviewed by Ryan Fulthorpe

[1] introduces you to i-Wonder to provide GAP insurance quotes.’s relationship with i-Wonder is limited to that of a business partnership, no common ownership or control rights exist between us