Gap insurance best for new cars, expert states

Fri, 13 Jun 2008

People buying a new car should consider taking out guaranteed asset protection (Gap) insurance, one expert has claimed.

Tom White, spokesperson for Auto Trader, explained that as new cars tend to lose their value quickly, the extra insurance can offer greater protection.

He said: "The newer and higher value of the vehicle, the greater the depreciation will potentially be and therefore Gap will have greater relevance."

Gap insurance is often used by people who have purchased a car on credit as car insurance firms payout on a vehicle's current market value, meaning that people can be left out of pocket.

Mr White recommended that people shop around for Gap, just as they would for any other car insurance product .

Earlier this week, research by uSwitch found that people who pay their car insurance premium monthly pay almost £50 extra compared to those who pay once a year, so people should pay in one lump sum if they can.
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