Gap Insurance like many other forms of insurance looks to protect you and your finances. However, Gap Insurance looks to protect you against the effects of market value depreciation.
Market value depreciation is the level at which your Vauxhall model will lose value over the course of ownership. Market trade experts predict that the average vehicle will lose up to half of the vehicles original value within the first three years of ownership.
This could have a detrimental effect on your finances if you were to write your Vauxhall off after a number of years of ownership. For Example, if you purchase a brand new Vauxhall Astra for somewhere in the region of £14,000 and three years later write the vehicle off, you would only receive the market value of your vehicle on the day of it being written off, which according to market trade experts will be somewhere in the region of £7,000. This could leave you with a financial shortfall of £7,000, whether that be in outstanding finance or just simply the gap between the market value and the invoice price of your Vauxhall Astra.
As you may know, there are three forms of Gap Insurance available for you to choose from and all of which have different capabilities. The first level of Gap Insurance for you to choose from is Finance and Contract Hire Gap Insurance, this level of Gap Insurance will cover the financial shortfall that is, the difference between the market value of your Vauxhall on the day it was written off or stolen and the amount of finance outstanding on the vehicle.
The second level of Gap Insurance for you to choose from would be Return to Invoice Gap Insurance. This level of Gap Insurance does exactly what is says on the tin and covers the difference between the market value of your Vauxhall on the day it was written off or stolen and the original invoice price you paid for the vehicle.
The final level of Gap Insurance for you to choose from is Vehicle Replacement Insurance. Vehicle Replacement Insurance will cover the difference between the market value of your vehicle on the day it was written off or stolen and the average cost to replace the vehicle with the same make, model, mileage and specification as yours was on the day of purchase.
Vehicle Replacement Insurance is seen by many in the Gap Insurance industry as being the highest level of cover available.
However, each form of Gap Insurance is different and has been designed for the different circumstances of which people purchase their vehicle. On the other hand, Vehicle Replacement Insurance is said to be the highest form of Gap Insurance due to the ability of the level of cover.
Vehicle Replacement Insurance will not only cover any level of depreciation on your Vauxhall but also any level of appreciation to the cost to buy a new Vauxhall model, the same make, mileage and specification as yours was.
For example, if you have purchased a brand new Vauxhall Corsa model for £10,000 and three years later write the vehicle off.
You then receive a settlement figure of £5,000 which is not only £5,000 short of the invoice price, but the cost of a new Vauxhall Corsa has gone up by £3,000
A Vehicle Replacement Gap Insurance policy here at Shortfall, will cover the difference between the market value of yout vehicle on the day it was written off or stolen (i.e £5,000) and the cost to replace the Vauxhall Corsa with the same mileage, specification and condition as yours was on the day of purchase (i.e £13,000) this means that your Shortfall Vehicle Replacement Insurance policy will cover the £8,000 difference, resulting in you having the ability to purchase a new Vauxhall Corsa.
All outstanding finance you have on the Vauxhall will be cleared, if any, and the full balance, deposit and equity is yours to do with what you please, resulting in you having the full £13,000 to do with what you please.
It is highly likely that during the purchase process of your Vauxhall model will be the first time you will have heard about Gap Insurance. It is also highly likely that you will have been offered a form of Return to Invoice Gap Insurance.
It is widely known that Return to Invoice Gap Insurance is the most popular form of Gap Insurance within the industry, however, not through popularity alone but through the level of exposure the policy type receives within dealerships across the U.K.
Return to Invoice Gap Insurance will cover the finance shortfall that is the difference between the market value of your Vauxhall on the day it was written off or stolen and the original invoice price you paid for your Vauxhall model. This will result in all outstanding finance being cleared, if any at all, and the full balance, equity and deposit is yours to do with what you please.
Below is a step by step example of how Return to Invoice Gap Insurance can work for you and your Vauxhall ...
For Example, if you have purchased a brand new Vauxhall Adam for somewhere in the region of £11,000. Three years later, you write your Vauxhall Adam off and receive a settlement of £5,500. This will leave you with a financial shortfall of £5,500.
This is where Return to Invoice Gap Insurance comes into play.
Return to Invoice Gap Insurance will cover the difference between the market value of your Vauxhall model, in this case the £5,500 valuation of the Vauxhall Adam and the original invoice price of the Adam which was the £11,000 figure. This would mean that between both insurers you will be returned to your full invoice price you paid for the vehicle. The only funds you would not receive is your Road fund tax as you can claim it back from the DVLA.
Why Buy Shortfall Finance and Contract Hire Gap Insurance for your Vauxhall online?
Finance and Contract Hire Gap Insurance is designed for those who have purchased their Vauxhall through the form of a financial agreement and only have the desire to protect any outstanding finance in the event of your Vauxhall model being written off or stolen. One point to be highlighted would be that if you have placed a deposit on your Vauxhall that you wish to protect, then a Finance and Contract Hire Gap Insurance policy would not have the ability to do so and instead a higher level of cover such as Return to Invoice may be the ideal choice for you.
However, if you are only interested in protecting any outstanding finance in the event of your Vauxhall model being written off or stolen then Finance Gap Insurance will be the ideal choice for you. Finance and Contract Hire Gap Insurance will cover the financial shortfall that is the difference between the market value of your Vauxhall on the day it was written off or stolen and the amount of finance outstanding on the vehicle.
Below is a step by step example of how Finance and Contract Hire Gap Insurance can work for you and your Vauxhall ...
For Example, you have purchased a brand new Vauxhall Adam at a great price of £10,000 with no level of deposit and the full invoice price financed over a fiver year period. Three years into the agreement, you wake up to an empty driveway. Several days later, your comprehensive motor insurer agrees to settle and offer you £5,000 for the model.
However, your finance company also send you a seperate settlement figure of £7,000, meaning that you now owe the finance company £2,000.
This is where a Finance and Contract Hire Gap Insurance policy from Shortfall can help you. Your Finance and Contract Hire Gap Insurance policy will clear the outstanding finance and leave you with the ability to walk away from the vehicle without any financial strings or attachments to the model.
It is an unfortunate fact, that every vehicle will depreciate over time. Industry experts actually claim that the average vehicle will depreciate by as much as half of it's value, within the first three years of ownership. It is very likely that your Vauxhall, will depreciate by upto half, by it's third birthday.
To help with your understanding of Vauxhall depreciation, we have taken recent figures from whatcar.com, on four different Vauxhall models, to show an example of how much your own Vauxhall is likely to depreciate, over one, two, three and four years.
Vauxhall Ampera Hatchback 16K Wh Electron 5dr
Price you paid: £38,995
Year 1: £22,149
Year 2: £18,402
Year 3: £15,274
Year 4: £13,223
With this example, this Vauxall model has decreased in value by £23,721 within the first three years and £25,772 in the first four years.
Vauxhall Adam Hatchback 1.2 Glam 3dr
Price you paid: £12,650
Year 1: £7,575
Year 2: £6,225
Year 3: £5,100
Year 4: £4,374
With this example, this Vauxhall model has decreased in value by £7,550 within the first three years and £8,276 within the first four years.
Vauxhall Zafira MPV 1.6i WT 115 Design 5dr
Price you paid: £22,315
Year 1: £8,051
Year 2: £6,628
Year 3: £5,427
Year 4: £4,650
With this example, this Vauxhall model has decreased by £16,888 within it's first three years and £17,665 within the first four years.
Vauxhall Corsa Hatchback 1.0i 12v ecoFlex Expression 3dr
Price you paid: £9,495
Year 1: £5,900
Year 2: £4,850
Year 3: £4,000
Year 4: £3,400
In this example, this Vauxhall model has decreased by £5,495 within the first three years and £6,095 within it's first four years.
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Vauxhall Motors is a British manufacturing company.
The history of Vauxhall dates back to 1857 when it was founded by Alex Wilson. The company first began manufacturing pumps and marine engines and would not build its first car until 1903, known as 6HP which was equipped with a 5 HP engine and without the ability to reverse. The company was renamed Vauxhall Steel Works in 1903 and then became officially known as Vauxhall Motors in 1907.
The company was taken over by General Motors in 1925 and too many took on an ‘American image’. During the Second World War, the company’s factories halted production and produced the well known Churchill tanks, which played a significant role in the allied victory.
The company took on a negative reputation post World War Two, as they were accused of ignoring particular quality measures which meant their models were prone to rust. They would hold on to this grudge until the 1980′s.
The company began a partnership with German based Opel during the 1970’s and would therefore take on a German image.
In the 1970’s, Vauxhall introduced its Chevette model, a 3 door hatchback which came to be very successful The Cavalier would later be released enjoying the same amount of success as its predecessor. However it was the 1990’s when the company introduced its Corsa model which would become the company’s most successful model.
In 2003, Vauxhall celebrated its 100th year and is the longest lived British marque of all time. Its two manufacturing plants are located in Luton, where it is headquartered and Ellesmere Port consisting of a total workforce of 35,000 workers.
The current Vauxhall portfolio consists of models such as: Agila, Adam, Corsa, Meriva, Astra, Ampera, Zafira Tourer, Zafira, Cascada, Mokka, Antara, VXR and Insignia.