What does Lease/Contract Hire GAP Insurance cover?
In the event your vehicle is written off or stolen, Lease/Contract Hire GAP Insurance will pay the difference between what your motor insurer pays you and any outstanding amount you owe the vehicle provider.
How do Lease/Contract Hire GAP policies work?
You lease a vehicle from a leasing company
Let's say you hire a vehicle worth £31,500 from a leasing company over a 4 year period for £729 per month. The total you will pay the leasing company over the length of the contract is £35,000, including interest.
The vehicle is written off
16 months later, after the vehicle is involved in an accident, your motor insurer deems the vehicle a 'total loss' due to the amount it will cost to repair it. Due to the vehicle losing value over time (depreciation), the vehicle is now only worth £20,475 and this is what your motor insurer agrees to pay you as a settlement.
You need to pay the remainder of your lease agreement
As you still have 32 months left to run on your lease agreement, you will need to pay the leasing company £23,328 as a settlement fee.
Your GAP policy has you covered
Our Lease/Contract GAP Insurance policy will pay the difference between what your motor insurer pays you (£20,475) and your lease agreement settlement figure (£23,328), which in this instance would be £2,853.
Lease/Contract Hire features & benefits
Covers vehicles up to £75,000
Provides up to 5 years GAP cover
Pays £250 towards your motor insurance excess
Covers manufacturer fitted extras
Covers cars and vans
Available to individuals and companies
Covers all drivers who are covered under the motor insurance policy
Covers up to 3 monthly rentals on a new lease agreement
Lease/Contract Hire policy restrictions
Vehicle must be deemed a ‘total loss’ by your motor insurer
Vehicle must be less than 12 months old
You must have Comprehensive Motor insurance in place
You must be 18 years old or over
You must be a resident of the UK
Vehicle must have been purchased within the last 90 days
Vehicle must be provided as part of a lease or contract hire agreement
Your Lease or Contract Hire Agreement cannot exceed £1,000 per month
For details on all policy benefits and restrictions, please read our Lease/Contract Hire policy wording before purchasing.
Should I buy a Lease/Contract Hire GAP Insurance policy?
A Lease/Contract Hire GAP policy could be beneficial to you if:
You have hired a vehicle through a Lease/Contract hire company
You wish to avoid paying finance repayments for a vehicle you no longer have
You want to protect yourself against paying a large settlement figure if your lease vehicle is written off or stolen.