GAP Insurance

What is GAP insurance?

Guaranteed Assist Protection insurance, also known as GAP insurance, is an insurance product designed for lease hire agreements and similar financial products. During this guide we will focus on GAP insurance for a lease vehicle.

Please note that GAP insurance is taken out alongside your regular vehicle insurance.

If a lease vehicle is written off or stolen and unrecoverable then your business will still be liable for the remainder of the lease payments. Your insurance company will pay what they value the vehicle at, and you can use this money to pay the remainder of the lease.

GAP insurance comes into play when there is a difference between the amount your insurer values the vehicle at and the amount your lease company is expecting to receive as it will bridge the gap between the two, which your business would otherwise be liable for you.

How does it work?

In the unfortunate circumstances that your lease car is involved in an accident and is written off or if it is stolen and unrecoverable, then you will need to let your insurance provider know just as you would for an owned vehicle and you will also need to notify the lease funder. 

If you take out a GAP policy we recommend letting your GAP provider know once you are aware that the vehicle is written off / unrecoverable. And then you can follow their process for a claim on GAP insurance if needed. 

Bridging the GAP Xceptionally, through Xcite

Every customer who leases a vehicle with Xcite Car Leasing can opt into 30 days of free GAP insurance, as long as they do so prior to the delivery of their new vehicle. Specifically designed for drivers who are just beginning a car lease through us, it provides immediate, no-cost protection during the first month of their lease. 

In its broader sense, GAP insurance refers to a financial product designed to protect you from depreciation-related financial losses if your vehicle is declared a total loss. In the context of a lease specifically, GAP insurance protects you by covering the shortfall between a main insurer's payout and the outstanding balance on a lease agreement in this scenario.

What’s covered by the 30-day GAP insurance?

This free, short-term policy requires zero upfront financial commitment with no obligation to purchase. It provides Return-to-Value (RTV) GAP insurance, covering the gap between what your main insurer pays out and the outstanding lease balance if the vehicle is declared a total loss (subject to standard conditions and exclusions in the Terms & Conditions).

Key benefits of free, short-term GAP insurance

·        Instant, no-cost coverage - Unlike traditional GAP policies, our 30-day policy is completely free, giving you immediate coverage on your new car without upfront fees or long-term commitments.

·        Protection from depreciation - New cars lose value quickly, especially in the first few months. With this free 30-day GAP insurance, you’re covered for the gap during this early period, so you won’t face the shortfall between what you paid and what insurance would cover in case of a total loss.

·        Fast and simple claims process - We provide payouts within 24 hours, making sure you aren’t waiting for funds if you need to replace your car.

·        Peace of mind for new purchases - The 30-day free offer gives you a full month of protection with no upfront financial commitment. It covers up to £250 in insurance excess.

Paid lease GAP insurance 

Once the trial has expired, you can implement a full-term policy to blend seamlessly with your free trial or  alternatively you can take out the policy at any point up to 6 months post-delivery of your vehicle.

Lease GAP insurance features & benefits

• Covers the shortfall between your insurance payout and the remaining balance on a lease agreement, as well as any settlement charges
• Often up to 75% cheaper than dealership-offered GAP insurance
• Up to £500 insurance excess cover and up to £3000 towards your initial rental
• Covers European road trips

Which leased vehicles can GAP insurance usually cover?

• New or used cars purchased on a lease or contract hire agreement
• Vehicles valued up to £125,000
• All cars up to 8 years old and 100,000 miles
•          Write-offs due to theft, accidental damage, fire damage and water damage

Which vehicles and scenarios are excluded from lease GAP cover?

Vehicles without fully comprehensive main motor insurance in place will be excluded. There are also a range of vehicles and scenarios excluded from cover, which include (but aren’t limited to) certain vehicle types and modifications, other drivers driving the vehicle, cases of negligence, fraud, dishonesty and situations where there isn’t a claim under the accidental damage, fire or theft sections of their motor insurance policy. If the vehicle was used in a competition, speed testing, off-road or in other specified excluded scenarios, the GAP insurance also won’t cover it.  For a full list of exclusions contact us.