There is something special about owning a brand new car. It's shiny, it has that new car smell and you have the pleasure of knowing no one has driven your baby but you.
However, buying a new car is no cheap feat, and the sad fact is the second you drive your new pride and joy off the showroom forecourt it will start to lose value.
This means that, should your car be written off in an accident or stolen, you could be left thousands of pounds out of pocket. The majority of car insurance companies will only pay out the market value of your car on the day that it was lost - so if you've taken out a loan to pay for it, you could be left with outstanding repayments on a motor you're still mourning!
And right now, when the cost of borrowing is high and people's budgets are already stretched, the last thing anyone wants to contemplate is paying off an expensive loan for a car they no longer have.
Enter gap insurance…
Guaranteed Asset Protection, better known in the motor industry as 'gap insurance', is designed to cover the difference - or 'gap' - between your car insurance payout and the amount of money you originally borrowed to buy your car.
So in the event your vehicle is destroyed before you've paid back your loan, the gap insurance policy will ensure you don't end up out of pocket.
