Gap Insurance is a supplementary insurance that runs alongside your motor insurance to protect you if your Taxi is written off or stolen.
Not many people are aware that if you are involved in an accident and your Taxi is written off or your Taxi is stolen, your motor insurance will only pay you the amount your Taxi is worth on this day. Due to depreciation and especially as a Taxi will more than likely do a significant amount of miles more than a regular car, this amount is likely to be a significant amount less than your Taxi was originally worth. Industry experts actually say that the average vehicle can depreciate by around 50% within the first three years of ownership.
As your Taxi is also your base for employment, if it is written off or stolen, this could have a significant affect on your livelihood and your finances. This is why we think it is extremely important to protect your Taxi with Gap Insurance.
Gap Insurance, depending on which type you opt for, along with your motor insurance, will either, return you back to the original price you paid for your taxi (Return to Invoice Gap Insurance), pay you the amount necessary to be able to purchase the same standard of vehicle again, age, mileage etc as yours was when you drove it away from the showroom (Vehicle Replacement Gap Insurance) or simply clear any outstanding finance you may have on an agreement ( Contract Hire Gap Insurance).
Which type of cover you choose completely depends on your circumstances, for example, how you paid for your taxi and exactly what you would like to protect.
Explore the different levels of cover to ensure that you are never left in a financially devastating position if your Taxi is ever written off or stolen.
However, if you are protected by Gap Insurance, it will ensure that you are in the right financial position to purchase another Taxi and get straight back onto the road in the shortest time possible.
Being part of Aequitas Automotive Limited, we are proud to have access to a number of different underwriting insurers and therefore we should be able to offer you low cost Gap Insurance for private hire/taxi useage. We understand that when purchasing any form of insurance, the terms and conditions of your policy and how it performs when making a claim are the most important factors. However, price is also an important factor.
With your Taxi being a valuable source of income, it is imperative that you consider a form of financial protection should the worst happen. The last thing you would want is to be left with no vehicle and therefore no source of income. If you have purchased your vehicle on a form of finance, you could be left paying for a vehicle you no longer have.
With a form of Low Cost Gap Insurance for your Taxi, you really can protect your investment. For Example, if you choose to protect your vehicle with Return to Invoice Gap Insurance, in the event of a total loss, we protect the original invoice price you have paid for the vehicle.
Your own motor insurance will pay the value of your Taxi at the point of total loss, we will then top you up from that figure right the way back up to the invoice price you have paid for the vehicle. Within which, you can then clear any outstanding finance owing, if any. Any money then left over, is yours to do with as you wish, i.e put towards the cost of a replacement vehicle.
Vehicle Replacement Gap Insurance will pay the difference between your motor insurer's valuation on the day your taxi is written off or stolen and the amount necessary to be able to purchase the same standard of vehicle again, that you drove away from the showroom in.
Vehicle Replacement Gap Insurance is designed to consider any possible increase in your Taxi's invoice price. There are a number of reasons why the cost of your Taxi may increase, such as an increase in VAT, an upgraded version of your particular Taxi or the cost of raw materials may increase.
Due to depreciation, your Taxi will start decreasing in value from the minute you drive it away from the showroom, with industry experts saying that the average vehicle actually depreciate's by 50% within the first three years of ownership.
Your motor insurance will award you with the amount your Taxi is worth on the day it is written off or stolen and due to depreciation and also the amount of miles your Taxi has covered, this is likely to be a significant amount less than it was worth originally.
Please see the below example to help with your understanding of Vehicle Replacement Gap Insurance.
Matthew purchases his Taxi for £30,000.
Three years later he is unfortunately involved in a crash with another vehicle and his Taxi is written off.
His motor insurance pay a settlement of £15,000, as this is the amount his Taxi was now worth.
Matthew now has a shortfall of £15,000 from what he originally paid.
His Taxi price has increased to £34,000.
This means that Matthew only has £15,000 to clear any outstanding finance if necessary and to purchase another vehicle.
Vehicle Replacement Gap Insurance would top up this motor insurance valuation with the £19,000 necessary to be able to purchase the same vehicle again.
Matthew now has the correct funds to be able to clear any outstanding finance if necessary and to purchase another vehicle if he so wishes.
Return to Invoice pays you the difference between your Taxi's valuation on the day it is written off and the invoice price you originally paid.
Not many people are aware that if you are in the unfortunate position of having your taxi written off or stolen, your motor insurance will only awards you with the amount your taxi has been valuated at on this day.
Due to depreciation and the significant amount of miles you are likely to have done, your taxi is likely to be worth a significant amount less than it was originally. Industry experts actually say that the average vehicle depreciates by 50% within the first three years.
Return to Invoice Gap Insurance will top up your motor insurance with the amount to take you back to the original invoice price you paid for your Taxi, leaving you able to clear any outstanding finance if necessary, or able to look around for a new Taxi.
It is important to protect any vehicle, though a Taxi is extremely important as this is also your base for employment and so could have a devastating affect on your finances if it was written off or stolen.
Please see the below example to help with your understanding of Return to Invoice Gap Insurance
Ken purchases a new Ford Focus for £10,000 for his job as a taxi driver.
Three years later, Ken's Taxi is stolen from in front of his house.
Ken's motor insurance awards the £5,000 that his taxi is now worth.
Ken is now £5,000 out of pocket from what he originally paid for his Ford Focus.
Return to Invoice Gap Insurance will top up the motor insurance valuation with the £5,000 necessary to take Ken back to the original invoice price of his Focus.
This leaves Ken in the same financial position he was in originally and able to clear any outstanding balance if necessary and able to focus on the more important things like looking around for a new taxi to continue his work in.
Finance and Contract Hire Gap Insurance for your Taxi will simply clear any outstanding finance you may have on an agreement.
If you find yourself in the unfortunate position of having your taxi written off or stolen, your finance company will still expect the outstanding balance that is owed to them, to be cleared.
Your motor insurance will only pay your finance company with the amount that your taxi is valuated at on the day it is written off or stolen. Due to depreciation, this is likely to be a significant amount less than it was worth originally.
This means that the remaining balance will be expected to be paid by you.
Contract Hire Gap Insurance for Taxi will simply top up the motor insurance valuation with the amount that is still outstanding on the agreement, leaving you to walk away with no financial liability and able to focus on more important things like acquiring your new taxi and getting back to work.
Please see the below example to help with your understanding of Contract Hire Gap Insurance.
Chris acquires a Ford Mondeo with an invoice price of £12,000 on a four year finance agreement for his Taxi work.
Three years later his Ford Mondeo is stolen.
His Motor insurance award him the £6,000 his Mondeo is now worth.
Chris still has £2,500 left to pay his finance company.
Without any form of Gap Insurance Chris would have to use his own savings to pay this to his finance company.
Finance Gap Insurance would simply clear this remaining £2,500, leaving Chris with no financial liability and able to focus on acquiring his new taxi and getting back to work.
At Shortfall we believe that you only ever know how good your policy is when you make a claim and when this applies to Taxi Gap insurance we also know that time is of the essence.
Your Taxi is your main source of income and how you make a living. No Taxi to use, no income. So, we have designed and tailor made our polices to be not only customer friendly but also quick and easy to claim.
From the moment that your own insurance company write to you to confirm that your vehicle has been written off and you have completed your claims pack our claims team are ready and waiting to take over.
This is not because we do not think that you can negotiate a settlement or that we think that you would not do a good job, far from it instead we simply do not want to put you in the position of having to.
Please remember that our policies have many features that other less well performing policies may not so why not Compare our taxi gap insurance and buy your policy knowing it will work instead of simply hoping it will.