GAP insurance on a used Range Rover is not a legal requirement in the United Kingdom. But in many cases, GAP insurance for used Range Rovers may still be worth considering. Used cars depreciate more slowly than a car fresh out of the factory, but there still can be a financial shortfall if they are written off or stolen and not recovered.
GAP insurance may help cover the financial shortfall. Insureworks can arrange GAP insurance quotes on a non-advised basis and is underwritten by specialist insurers. Insureworks Ltd is an appointed representative of Your Company Matters Ltd, which is authorised and regulated by the Financial Conduct Authority (FCA).
Depreciation on a Used Range Rover
Let’s say you’ve bought a second-hand Range Rover for £35,000. At this point, depreciation is on your side because you’ll be able to experience the luxury of driving a Range Rover around the country for less than a brand-new motor. You’ve likely saved yourself a lot of money, but it might still be a significant purchase.
After a year, the car is written off. Your insurer values it at £28,000 based on market conditions at the time. If you paid £35,000, that leaves a £7,000 difference. Even on a used vehicle, that is not a small amount. Used Range Rover GAP insurance could cover that shortfall, depending on the policy terms.
Why GAP Insurance can Still be Relevant on a Used Range Rover
It’s easy to think that GAP insurance is only relevant to new cars due to the impact of depreciation in the first year. But that’s not the case. Depreciation, although usually less impactful, still occurs on second-hand cars. This is especially true if the second-hand car is less than five years old.
Range Rovers, even used ones, often hold a higher price point than many other vehicles. That means any drop in value, even if it is slower than a new car, can still result in a noticeable financial shortfall. For some, the initial purchase price of a second-hand car may also represent a significant sum.
Used car prices can vary based on mileage, condition, age, and, most importantly, market demand. If the car is written off at a time when the interest in the car is lower, the insurer’s valuation may be lower than you expected, compared to when you bought the car. For these reasons, some drivers decide that used Range Rover GAP insurance is relevant for them.
When is GAP Insurance Worth it on a Used Range Rover?
If you’re stuck in a conundrum and trying to decide whether GAP insurance will be worth it for you, then it often comes down to how you bought the car and how much risk you are comfortable taking.
Drivers who tend to lean towards purchasing GAP are usually those who have financed the vehicle and still owe a significant amount. This is especially true if drivers spread the cost over several years, as the outstanding balance may not reduce quickly.
It can also make sense to pay a higher price for a nearly new model. These vehicles may still experience noticeable depreciation, particularly as they approach their original registration date.
On the other hand, drivers who paid outright or secured a short PCP agreement on an older model may prefer to accept the risk rather than take additional cover. This is because depreciation may be lower, and the potential shortfall may be smaller.
How Does Used Range Rover GAP Insurance Work?
Used and new GAP insurance work in exactly the same way. If your Range Rover is written off or stolen and not recovered, your comprehensive insurer will pay out the current market value. Depending on your policy terms, GAP insurance may then step in to cover the difference between that payout and what you originally paid or still owe on the car.
Choosing the Right Type of Range Rover GAP Insurance
Insureworks offers two different types of GAP insurance. For drivers who want to purchase GAP and either buy the car outright or protect the amount they initially invested, Return to Invoice GAP Insurance is ideal.
Return to Finance GAP insurance focuses on clearing any remaining balance on your loan or finance agreement. This can be helpful if your main concern is avoiding debt after a write-off.
Choosing the right option for you depends on two factors. First, it depends on whether you lease the car or own it outright. Secondly, it depends on whether you want to protect your initial spend/long-term debt.
Limitations to Keep in Mind
Used Range Rover GAP insurance is not completely watertight. You will need to hold a fully comprehensive motor insurance policy to be eligible for GAP, and any GAP claim relies on your main insurer accepting the write-off first. The cover is usually limited to total loss or theft and not recovered, but it’s worth double-checking your policy terms to make sure.
GAP will not cover general wear and tear, mechanical faults, or small repairs from minor bumps that don’t write off the car. There may also be limits depending on the age or mileage.
FAQs About GAP Insurance on a Used Range Rover
We know you might have questions about Range Rover GAP insurance. The following FAQ section will help answer some of the most common questions we get.
Is GAP Insurance Worth it on a Used Range Rover?
Judging whether Range Rover GAP insurance is worth it depends on your personal circumstances. The following is a list of example situations where drivers sometimes consider it.
- The car isn’t “too old” and may still lose a significant amount of value.
- The deposit was small, which leaves a long-term lease on the car.
- The particular model or version of the car loses value more quickly than others.
- The car was bought recently, and the owners want to protect the amount they paid for it if the car is written off soon after purchase.
When Should Range Rover GAP Insurance be Set Up?
If you are planning on getting GAP insurance for your used Range Rover, it’s best to sort it out as soon as possible. This is because depreciation starts as soon as you set foot inside the car for the first time. Adding an additional owner tends to reduce the value. Depreciation will continue to happen as you rack up the miles. If your car is written off or stolen soon after purchase, there may still be a financial shortfall between your motor insurer’s payout and what you paid or still owe. GAP insurance may help cover some or all of that shortfall, depending on the policy terms.
Do I Need Range Rover GAP Insurance if I am Leasing The Car?
GAP is not a legal requirement, but many drivers consider GAP insurance when leasing a car. If your leased car is written off or stolen, there may still be an amount due under your finance agreement after your motor insurer’s payout. Paying for a car sitting in a scrapyard is usually not an ideal scenario. GAP may help cover some or all of that shortfall, depending on the policy terms.
Expert Insight
“Even with a used Range Rover, the values involved are still high enough for a shortfall to exist. GAP insurance can help protect that investment, particularly if the vehicle is written off sooner than expected.”
Nick, Insurance Specialist at InsureWorks
Wanting to Sort Used Range Rover GAP Insurance?
Getting a quote for Range Rover GAP insurance is quick and straightforward with Insureworks. There’s no jargon, and no faff. We will arrange cover quickly. All you need to do is answer a few questions about yourself and the vehicle.