RTI and Gap insurance for cars after a total loss
New cars depreciate quickly and, unless you have RTI or GAP insurance for cars bought on a finance scheme, you could be financially out-of-pocket if your car is written off after a car accident.
Insurers deem over half a million cars every year to be total losses following accidents, fire or theft, and drivers with a large proportion of their loan or finance plan left to pay could be left owing a hefty chunk of money as a result.
An owner's legally required motor cover, including fully comprehensive car insurance, will only pay out the market value of your car if it is deemed irreparable, but in many high value cars this is likely to be below what is left on the finance scheme.
So, If a car had a ticket value of £30,000 and the owner had paid back £5,000 worth of the loan or finance package, if the insurer settles the claim for total loss with a cheque for £20,000 the owner would find themselves owing the loan company or finance firm £5,000.
Many companies financing the purchase of a high value car on Hire Purchase, Contract Hire, or Personal Contract Purchase now insist on GAP insurance (Guaranteed Asset Protection). And if the car has been paid for outright, perhaps with a car loan, RTI insurance (Return to Invoice) could be an appropriate product, to ensure the owner gets back what he or she paid for the car if the car insurance provider deems the vehicle a total loss.
Legally required insurance for cars
Buying Gap or RTI insurance for cars will protect car owners from depreciation in the event of a total loss, but it is not a legal requirement unlike basic car insurance.
All car owners are required to have a minimum level of insurance for cars, starting with third party cover.
Third Party Only (TPO) insurance will cover the drivers liability for third party persons, including the occupants of the driver's car and other cars involved in an accident. This level of cover will pay for damage to the other party's car and any claims for death or bodily injury, but will not pay out for damage to the driver's vehicle when he or she is at fault.
Third Party Fire and Theft (TPFT) insurance cover is the same as TPO, but also means that the vehicle is covered against risk of fire or theft. (Policy holders are advised to check with their insurer regarding level of contents covered by the insurance.)
Comprehensive cover insures a vehicle to the same level as TPFT, as well as covering damage to the insured vehicle as a result of an accident caused by the driver. Policies vary in their levels of cover for contents and personal injury insurance, and car insurance buyers are advised to check their policy to ensure their cover is as they want it.
Duck2water insurance for cars
Here at duck2water we specialise in online car insurance providing cheap quotes for comprehensive cover. We keep our overheads low, so that we can offer you some of the cheapes car insurance around.
Click on the 'Quote' button now to get to fill in a proposal form online or call our friendly advisors on 0333 123 1308 who can guide you through our quick and simple process in a matter of minutes.
Buying your legally required insurance for cars has never been simpler; it will be up to you if you wish to seek out a provider of RTI or GAP insurance as an extra protection. So, call us now and get legally covered quick.