Compare our best gap insurance

Guaranteed Asset Protection insurance – gap insurance for short – fills the ‘gap’ between the amount your insurer will pay out if your car is written off or stolen and the price of a new car.

It’s a useful addition to standard car insurance because a new car begins to lose value the moment you drive it off the forecourt. How much it depreciates depends on its make, model, mileage and condition. But you can expect an average new car, driven 10,000 a year, to fall in value by 60% after just three years, according to the AA.

With gap insurance, you get a payout that’s enough to pay for a replacement car, and if your vehicle is less than a year old, that could mean getting a brand-new model.

You can read more about how gap insurance works here.

Gap insurance isn't for everybody, but it can be useful in some circumstances, such as with cars financed using a personal loan.

In this case, you’ll still be liable for the loan at the car's original value if your vehicle is stolen before you’ve paid it off. Your car insurer will pay the vehicle’s value at the time of the theft, but gap insurance can make up the difference. This could prove very handy if you have a lot still to repay on your loan, while contemplating the cost of a new car.

Gap insurance is an additional cost and is not included in your car insurance policy.

Car dealerships often offer gap insurance for from £100 to more than £300 as a flat fee for a three-year policy. You may find it cheaper to purchase gap insurance independently. Use our comparison tool to find the best deal.