Jan 262018
 

Analysis of the latest figures from Warranty Direct’s GAP insurance division has revealed an alarming increase in claims for car thefts and write-offs over the past three years.

Warranty Direct’s findings show claims for write-offs have proportionally risen by 55% since 2014. This has resulted in a considerable cost to both the insurer and consumer.

The average individual claim value for vehicles written-off over the three-year period was £3,765 with some of the highest individual claims being over £15,000.

Manufacturer Percentage of overall claims Average claim value Highest claim
1. BMW 17% £4,286 £15,364
2. FORD 17% £2,377 £6,200
3. MERCEDES-BENZ 11% £5,165 £13,320
4. VAUXHALL 11% £2,347 £6,895
5. AUDI 4% £4,905 £9,740

 

When analysing manufacturer trends, the brands most likely to be written off or subject to theft were BMWs and Fords, which made up 17% of total overall GAP claims. This was closely followed by Mercedes-Benz and Vauxhall in second place (11%) and Audis in third place (4%).

While BMW and Ford took the lead when it came to the highest percentages of overall claims for vehicles written off or stolen, the highest costing average claims were made by Mercedes-Benz drivers at £5,165 per person, closely followed by Audi drivers, whose claims averaged at £4,905.

Advances in immobiliser and keyless technologies resulted in a decline in vehicle crime throughout the 2000s. However, it seems criminals are now finding ways to counter the latest safety innovations and technology as vehicle-related theft has risen 30% since 2014.

Warranty Direct’s data has shown the average individual pay out for theft-related claims since 2014 resulted in £3,360 per customer.

Simon Ackers, Warranty Direct’s Chief Executive Officer commented on the results: “It’s clear from the recent steep rise in vehicle-related thefts and write-offs, advances in vehicle manufacturing and technology cannot always prevent irreparable damage. The motoring industry must continue to adapt and encourage consumers to guard against potential loss with GAP insurance and visual deterrents such as steering wheel locks and alarms, which could help protect vehicles from theft.”

Sep 032017
 

The prospect of buying a brand-new car is an exciting one, especially as some of the newest models give access to the latest features in terms of safety, performance and comfort.

It’s vital you give your decision careful consideration though, as different needs, budgets and features, means finding the right option can be confusing.

That is why we’ve put together our Warranty Direct guide on what to look for when buying a new car.

Budget

Before you start looking at favoured options, you should finalise a budget and know how to maximise it. Some will be able to buy a new car outright, but many of us will need to consider finance options. Some of the most cost-effective finance deals are available with 0% APR and if size is not an issue smaller models can be a good option as many are available from as little as £150 per month.

How much your loan costs will depend on your credit history, and knowing this can be useful as it will give a better idea of what to expect from lenders. The Consumer Credit Act allows consumer access to credit reports by post or online.

Longevity

Taking a more practical view when it comes to vehicle choice is a good way to pick a car that’s best for the long-term. Whilst a small sports car may retain its value well and be suitable for your current lifestyle, it might be completely inappropriate for your needs a few years down the line.

Economy, in terms of MPG and fuel type, will also be important with the new diesel tax on the horizon. Smaller petrol cars will be good to consider after this change, as they will most likely retain their value better and have lower road tax.

Features and extras

Motoring technology is advancing at an unparalleled rate and in-car systems such as WiFi, 4G connectivity and voice control are becoming commonplace. However, technology will continue to develop features such as parking assist, night vision cameras and autonomous safety features, meaning more improved safety and comfort.

Assessing and researching these latest features will allow you to work out which deals are the best value for money when it comes to meeting your own, personal requirements.

Models that hold their value

The biggest issue when buying a new car is they can lose their value quickly. Most cars depreciate at a rate of around 20% per year over the first three years of ownership. Some models shed cash quicker than others, meaning you’ll get a lot less when you come to sell it on.

It’s important to research which vehicles usually retain their value better than others, such as budget SUVs or smaller sports cars.

For more information on depreciation, you can also consult our guide.

You can guard against any potential loss of value by investing in a GAP insurance policy, which is particularly worthwhile if you’re paying for a new motor on finance.

When it comes to a car, assessing your needs, financial situation, and forthcoming industry developments will mean you’re well-placed to get the maximum for your money and your vehicle will retain more value for longer.

Jan 092017
 

For many of us, our car is one of our most prized possessions and one of the most expensive purchases we’ll ever make.  Despite how careful we might be whilst driving and how well we look after our cars both on and off the road, anything could happen.  Being unlucky enough to have your car stolen and not recovered, or to be involved in an accident where your car is written off, is never beyond the realms of possibility.

In addition to the emotional strain these eventualities can put you under; there will inevitably be financial implications.  However comprehensive your insurance policy might be, if your vehicle is declared a “total loss” and you make a “total loss claim” to your insurer, most insurers will only pay out the current market value of your vehicle at the time of incident.  This could leave you with a shortfall of thousands of pounds in comparison to the purchase price of the car, meaning that if you want to replace it with a like-for-like you’ll have to make up the outstanding balance.

To guard against this potential cost in the event of a total loss claim, you can cover yourself with a GAP (Guaranteed Asset Protection) insurance policy, to cover the difference.

How GAP insurance works:

When buying a new car for, say, £20,000, a consumer takes out both a comprehensive motor insurance policy and a GAP insurance policy. Over the course of the first three years of ownership, which is when a new car depreciates the most, the market value of the car may fall to, say, £12,000.

If an accident then happens or the car is stolen but not recovered, a total loss claim would need to be made. When the claim is approved, the motor insurer would pay out the market value of the car (the £12,000) and GAP insurance covers the outstanding balance of £8,000, which covers the remaining amount of the car’s original purchase value.–

What cover is available:

There are commonly three types of GAP insurance available, and at Warranty Direct we pride ourselves on arranging flexible policies that can cater to new or used cars either purchased from a dealer or privately*. The three types of policies offered by Warranty Direct are:

  • Vehicle Replacement Insurance (VRI) – this covers the difference between what the motor insurer pays out and the cost of a brand new car of the same make, model and specification. This policy gives you cover even if the manufacturer’s prices have increased since buying the original car.
  • Return to Invoice Insurance (RTI) – this covers the difference between what the motor insurer pays out and the original invoice price paid for the car.
  • Return to Value Insurance (RTV) –this covers you  for the difference between what your motor insurer pays out and the value of the car at the time when the GAP policy was purchased (which doesn’t need to necessarily be when you bought the car)

 

Other factors to consider:

As with most insurance policies, there are some limitations to Warranty Direct’s GAP Cover Insurance which you should be aware of before taking out a policy. Below are the most significant ones:

  • If your motor insurer doesn’t pay out on your total loss claim then you will be unable to claim on your GAP insurance, as the two go hand-in-hand.
  • Your GAP cover will be invalidated if the vehicle is written off due to an accident where the driver is under the influence of alcohol or drugs.
  • Warranty Direct’s GAP Cover insurance isn’t available for electric cars, motorbikes, vehicles modified from the manufacturer’s specification or vehicles which are used for pacemaking, speed testing, other competitive events, or for hire or reward.
  • The incident leading to the total loss of the insured vehicle must occur within Great Britain, Northern Ireland, Isle of Man, Channel Islands or the European Union.

It is of course important to consider the pros and cons of any policy of insurance and make sure you read the full terms and conditions in order to understand exactly what the policy entails and see whether it is right for you. You can obtain a copy of Warranty Direct’s full GAP policy terms and conditions from our website. Carefully considering all the factors such as the ones above will give you the freedom to pick a policy you know is right for you and prevent ill-informed decisions, which could lead to costly consequences.

Why Warranty Direct:

We’ve been providing GAP insurance since 2011 and are one of the leaders in the industry. With the cost of our GAP cover starting from just £136 for three years**, we aim to provide competitive and affordable cover which will help you avoid being out of pocket in the unfortunate event that your car is written off or stolen and not recovered.

Find out more about our policies here, so you can plan how best to cover yourself from potential financial loss.

* Types of product available subject to car eligibility criteria. See www.gapcoverinsurance.co.uk for more information.

**Price is based on a 3 year Return To Invoice policy for a Ford Focus 1.6 TDCI with a £5,000 claim limit.

Warranty Direct’s GAP Cover Insurance policies are underwritten by LAMP Insurance Company Limited, whose registered office is Suite 934 Europort, Gibraltar, company number 93562. LAMP Insurance Company Limited is licensed and regulated by the Gibraltar Financial Services Commission under the Financial Services (Insurance Companies) Act. Policies are administered by Warranty Direct Limited, Quadrant House, 20 Broad Street Mall, Reading, RG1 7QE, company number 3233010. Warranty Direct limited is authorised and regulated by the Financial Conduct Authority.