What is Agreed Value Gap Insurance?
What does agreed value gap insurance do?
How can agreed value gap insurance protect you?
As I am sure you know now we think that gap insurance can be a really good way to protect yourself and your finances. But there is one big problem with standard forms of gap insurance. They are fantastic is you have bought your vehicle from a VAT registered garage or main dealership but what about if you bought your vehicle privately? What about if you bought your vehicle from auction?
As you will not have a vat registered invoice to show should you ever need to make a claim what happens to gap insurance. What about if your own insurance company offered you new for old within the first 12 months of your vehicles lifetime and you simply forgot to buy another policy. Naturally you would of by then owned your vehicle for over the magic 180 days and would therefore not be eligible for standard forms of return to invoice and vehicle replacement cover.
Agreed value gap insurance is almost like a big safety net. By this we mean that it allows a level of protection for all. Instead of suing the invoice price as a starting point it would however use a set guide price on the day that you bought the policy.
In most cases this is Glass’s Guide Retail. But agreed value gap insurance is just like any other insurance so never assume. that this is the guide that they use. In some cases we know for example that one supplier allows you protect your vehicle with agreed value gap insurance which is based on 105 % of Glass’s guide retail. Anther uses Parker’s Guide Private good.
The absolute most important thing to consider when buying agreed value gap insurance is make sure you know exactly how much you are protecting. After all this is the maximum amount that you will be return to should you vehicel be written off.
For example you buy an agreed value gap insurance policy for a vehicle worth £10,000. 3 years later it is written off and your own insurance company offer you £4800. Agreed value gap insurance would therefore pay the difference between your vehicles valuation and the £10,000 to protected.
So to summary agreed value gap insurance protects the valuation of your vehicle on the day your buy the policy and remember to always confirm exactly what price you are protecting.