Most Gap Insurance providers will have a range of products that you can transfer if you change your vehicle before the end of the policy term. This can be important, with many of the better brand allowing up to 5 year cover for the likes of Return to Invoice and Vehicle replacement products. You may have every intention of keeping your vehicle for a full 5 years, but if you do change it early then it is nice to know that the majority of products will allow you to ensure you do not lose the value of your cover.
However, there are actually different approaches that Gap Insurance brands can take to how you can transfer the balance of your cover. They can be divided into two different methods.
1 Transfer of Value of remaining cover – this means that the monetary value of the remaining cover can be used as a discount on the purchase of a brand new policy.
2 Transfer of the original policy terms and features – this means the transfer of the original policy terms and features onto your new vehicle.
The first method may not be what consumers may consider a transfer, as it requires the purchase of a brand new policy. The issue with this may be that the new product that you are required to buy may have completely different features to the original ones you had on your first policy. This may not always be apparent when you request to transfer your cover.
Of course the policy terms may have actually improved from your point of view, and this is great. However, if your provider offers you the option of a transfer of the original terms and condition OR the option to get a refund on your old policy and take out a new policy then you have all options open to you. If your ‘transfer’ option of only to buy a new product with a discount, then this may not give you the best of both worlds.
You should check how your provider offers to ‘transfer’ your cover, not all products will do this the same way and you should not simply assume that they do.