Little-known car insurance could save you £5,000 if your car is written off in accident – everything you need to know
A HIDDEN car insurance trick could save you £5,000 if your vehicle is written off.
Motorists claiming on this insurance stand to gain big - as average payouts have tripled in the past four years.
2
GAP insurance payouts have nearly tripled in four years
Credit: Alamy
The average payout for Guaranteed Asset Protection - or GAP insurance - has soared from around £1,600 in 2021 to nearly £5,000 this year.
This little-known insurance hack is rarely used - with a Financial Conduct Authority probe revealing that the average driver with GAP insurance makes a claim just once every 300 years.
This product is mainly used to cover a potential shortfall between a car's value and the amount owed on finance if the vehicle is written off or stolen.
Drivers who need to make a claim are likely to receive larger payouts, as those who've financed their cars currently face several financial risks.
Read more on motors
GAP insurance is used not only by those with financed cars but also by owners who bought cars outright—they can claim if the insurer's payout is less than what they paid for the car.
Several factors have contributed to the soaring cash value of GAP claims.
These include the fast depreciation of certain vehicles - especially EVs - and a rise in insurance write-offs caused by soaring repair costs and parts shortages.
Rising motor thefts, targeting
models
like Range Rovers, have also driven up the cash value of GAP claims.
Most read in Motors
Experts say GAP insurance has shifted from a 'nice-to-have' policy to a 'vital financial safeguard' for today's car buyers.
The increase in the value of payouts "underscores the growing financial risk faced by car owners" in 2025, according to MotorEasy, a leading car ownership platform.
Ford is forced to immediately shut down factories and halt car production as CEO admits 'day to day' struggle for brand
However, this type of insurance has been controversial in the past, as it's often sold by dealers alongside cars - sometimes with limited explanation or inflated prices.
It's usually cheaper to buy GAP insurance through brokers.
The increase in the value of payouts "underscores the growing financial risk faced by car owners" in 2025, according to MotorEasy, the leading car ownership platform.
MotorEasy says the rise in average claim amounts is linked to the lasting effects of Covid-19.
However, since so few motorists were using GAP policies, the Financial Conduct Authority launched an investigation in 2023 over concerns about their value.
This led to many policies being withdrawn, with about 80 percent of products pulled from the market.
Experts now advise car buyers to compare policies carefully and consider brokers rather than accepting dealer offers.
Meanwhile, insurance experts have shared eight tips to help drivers
Tom Banks, a coverage expert for
This means you agree to pay more out of pocket if you make a claim, which lowers the amount the insurer has to cover.
Tom explained: "You want to make sure that you will be able to afford to pay it should you need to make a claim.
"But it's worth bearing in mind that choosing a higher voluntary excess will usually bring your car insurance premium down."
What is car insurance?
Consumer reporter Sam Walker talks you through what car insurance is and what it covers you for...
Car insurance pays out if your vehicle is stolen, damaged, catches on fire or is involved in an accident.
As a minimum, it protects you against any damage you case to other road users, the public or their property - these are called third parties.
You only need to claim on your car insurance when an accident is your fault.
If another motorist is to blame, their insurance should pay out instead.
Car insurance, unlike home insurance, is a legal requirement and if you don't have it you can be fined up to £1,000.
You can also have your vehicle seized and destroyed.
However, you don't need to insure your car if it is classed as "off-road", or holds a statutory off road notification (SORN).
The vehicle has to be kept on private land and not a public highway though.
2
The value of GAP has soared due to the depreciation of EVs and rising thefts
Credit: Alamy Live News
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Irish Sun
3 hours ago
- The Irish Sun
I flew on the world's best airline – it felt like a hotel in the sky and even economy seats are roomy
THE best airlines in the world have been revealed for 2025 - and Qatar Airways has come out on top again. It is the ninth time it has been 4 Qatar Airways has again been named the world's best airline Credit: Alamy 4 We tried out both the economy and business (with no premium economy onboard) Credit: Rex Not only that, but it was also named the Best Airlines in the Middle East - and having the best business class in the world. frontline to behind the scenes, the passion and commitment of our people continue to set new standards in aviation.' And we have been lucky enough to fly with them when travelling to I tried out their the airline's Read more on airlines I've always been a budget traveller, never understanding why someone would fork out money to get from A to B. But, three years after flying with Qatar Airways, it is still something I talk about to friends. It feels like a hotel room in the sky (so much so that it became a highlight of my trip - perhaps even more than some parts of the holiday itself). While you would expect all business class seats to be amazing, I can say that they are not all made the same (with two airlines I won't name barely being better than premium economy...) Most read in News Travel Staff are extremely friendly, their non-alcoholic lemon and mint mocktail has a huge following online for being so delicious and I had enough movie choices to keep me busy the entire flight. While business class is never affordable, the route from London Heathrow to Doha is an option for a special occasion spend. Airline launches world-first onboard suites that are five windows long 4 Qatar Airways' business class is something I still think about years later 4 The Qsuite door gave me so much privacy Credit: Kara Godfrey Tickets can be found for around £1,800, which will be in the special Qsuite. It is certainly a great way to end a bucket list holiday. Perhaps controversially, the airline doesn't have a premium economy, only offering First, Business and Economy. But it's not just their business class that was amazing - the Sun's Assistant Travel Editor Sophie Swietochowski also tried out the airline's economy cabin. She said: "Economy seats in Qatar Airways' newer aircrafts feel much roomier than those on other airlines I've travelled with. "The design is sleek and stylish and there are conveniently-placed USB ports for charging your devices, but that's not what makes the carrier standout. "For me, the highlight of flying Qatar Airways is the service. "As with most Middle Eastern airlines, customer care is a step above the rest. "Staff are diligent and eager to please, ensuring that you're well looked after and refreshed throughout the journey. "All in all it makes for a more comfortable experience." Flights in economy are much cheaper, thankfully, with routes from London to Doha from £474 return. Here are some of our other World's Best Airlines 2025 Qatar Airways Singapore Airlines Cathay Pacific Airways Emirates ANA All Nippon Airways Turkish Airlines Korean AIr Air France Japan Airlines Hainan Airlines
The Irish Sun
4 hours ago
- The Irish Sun
EVs ‘more likely to break down and leave drivers stranded than petrol or diesel cars,' damning report reveals
ELECTRIC vehicles are reported to be more likely to breakdown on the road than cars with petrol or diesel engines, according to research. A survey of nearly 30,000 drivers looked into their experiences with breakdowns over the past two years. 3 The survey found 16.8 per cent of battery car drivers experienced a break down recently Credit: PA 3 This compares to 10.7 per cent of petrol car owners who reported a break down. Credit: PA The Overall, 11% of respondents of the survey had suffered a fault in the last 24 months that made it undriveable. A similar figure of 10.7 per cent of petrol car owners reported a break down in this time, which is a significantly lower rate than batter car owners. Read More Motors News Results of the survey come just days after the boss of AA reported attending a higher proportion of electric car breakdowns. In 40.6 per cent of these break downs, the EVs had to be towed from the roadside to a garage. However, only 29.6 per cent per cent of petrol cars required this. CEO of the breakdown service provider, Jakob Pfaudler, added EVs are prone to not only punctures, flat batteries, but also jammed charging cables and technical glitches. Most read in Motors He claimed EV breakdowns are more common despite the "idea "common misconception" that they are more reliable than internal combustion engine cars due to having fewer moving parts. On top of that, the report found there was only a one in four chance EV drivers would have their cars permanently fixed by a breakdown company after being stranded on the road. This is in comparison to two in five petrol car owners who were able to get back on the road after calling out roadside assistance. The Sun's Motors Editor Rob Gill takes the new electric Renault 5 for a spin As a result, EVs were the most commonly transported vehicles taken to garages for repairs, as they cannot be towed. They are unable to be towed due rotation of their driven wheels risking of damage to their e-motors. Edmund King, president of AA, also suggested EV drivers are more likely to be confused and flustered by warning lights in their cars, leading them to call for roadside assistance. Whereas petrol car drivers often drive to a garage when being given warning alerts. King estimated, however, that only 86 per cent of traditional cars could be dealt with at the roadside compared to nine in ten battery powered cars which tend to just need a "simple reboot". An additional positive for EV drivers from the survey data suggested their breakdown-related faults could typically be resolved for free, more than any other fuel type. 89% of EV faults could be resolved at zero-cost for the driver, according to the survey, with only three per cent paying more than £1,500 for fixes. Hybrid cars did even better on this front, with 91% being fixed for free, and only two per cent paying over £1,500. However, 76% of petrol car owners reported having their vehicle repaired at no cost following breakdown, and only two-thirds of diesel car drivers. 3 WhatCar? research also found Britannia Rescue to be the best breakdown assistance provider in terms of timing and quality Credit: Getty
The Irish Sun
4 hours ago
- The Irish Sun
Every driver in Britain warned of £5K fine THIS WEEKEND over common mistake – how to avoid penalty
BRITS are being warned that a simple driving mistake could cost them £5,000 over the weekend. The warning comes as the UK braces for a Advertisement 3 An urgent warning has gone out to drivers ahead of the weekend Credit: Alamy 3 Wearing sandals whilst driving the car could lead to a hefty fine Credit: Getty 3 The news comes as the UK braces for a heatwave Credit: Alamy The Rule 97 of This includes being dressed appropriately. In the summer months, millions of Brits swap their trainers for Advertisement Read More on UK News Any If you are found to be 'driving without due care and attention', you face an on-the-spot £100 fine. Three points could also be added to your license. If the matter escalates to court, you could face fines of up to £5000. Advertisement Most read in Motors Exclusive Warning Speaking to the Express, John Wilmot, CEO and founder of LeaseLoco said: "It's easy to overlook how your choice of clothing or footwear can affect your driving, especially in hot weather, but even something as simple as a pair of flip-flops or a long skirt can reduce your control of a vehicle. "If this leads to an accident or you're stopped by police, you could face serious consequences. The Secret Behind Green Road Signs 🚦 'So we're urging all drivers to think practically before getting behind the wheel this spring and summer - your outfit shouldn't compromise your safety or anyone else's." The news comes after Advertisement The country is bracing for highs of 29C today, with the East of England likely facing the hottest temperatures. In some areas, meteorologists have forecast highs of 33C and have said the heatwave will continue through to the end of the week. A heatwave is when temperatures exceed thresholds in a certain area for over three days. Across the north and west of the UK, this is 25C and in the Home Counties and London it is 28C. Advertisement Wearing flip-flops in cars Wearing flip-flops in the car isn't technically illegal, but it still could lead to you being fined. Rule 97 of the Highway Code states that you must be adequately prepared to drive. This includes having enough petrol and wearing appropriate clothes. Wearing flip-flops can count as being inadequately prepared since it could interfere with your ability to use the pedals. That could lead to a £100 fine and 3 points on your license. If the case escalates to court, then the fine could rise to £5000.
