Sunday, 27 April 2014

Mind the Gap!

Recently there have been reports on the radio from consumers complaining about a company after they had bought a vehicle from them and then experienced high pressure selling to take up Gap Insurance. This is not insurance against getting trapped on the Underground or stuck inside a certain High Street clothing store, but a policy that covers the period between what you pay for a car on the day you buy it, and what it might be worth later if you have an accident or wrote it off and needed to claim on your insurance.
High pressure selling by car salesman angers consumers
For one particular buyer who had put a deposit on a second hand car, arranged for the change in registration documents and returned with a banker’s cheque for the outstanding amount, it came as a surprise at just how high pressured gap insurance selling could be. After completing the sale and then being offered gap insurance, the buyer refused, at which point the salesman became fairly insistent and when the manager was called and again the buyer refused the policy, he was told that the sale of the car could not go through. Fortunately the buyer knew his consumer rights and drove away in the car he had purchased whilst refusing to sign a waiver from the salesman because he didn’t want gap insurance. The car company staff had insisted this was a legal requirement under the Financial Services Act, a point that was refuted by Professor of Consumer Law at Plymouth University on Radio 4 You and Yours this week.
Gap Insurance could be an unnecessary additional expense for consumers
When it comes to insurance policies particularly around cars it does pay to do a little research so that you don’t get bullied into buying something that you don’t need. For instance, if you buy a car and you don’t take out a comprehensive insurance policy, only Third Party, then it is pointless getting Gap Insurance because it won’t kick in unless you have comprehensive insurance. It did set me thinking, as I am in the process of looking for a second or third hand car, what use would I have for Gap Insurance? Possibly if I was to take out a financial plan to fund my new transport and then on the way home, wrote off the vehicle, I would be stuck with paying out for a car I no longer had. On the other hand, comprehensive car policies should cover this type of incident and there is usually something included that could cover you in the financial agreements or your other motor policies.
The hard selling of these policies might be coming to the fore because for some salespeople, perhaps they come with a hefty commission, which is not a benefit to the consumer. We pay out enough as it is for cars and their related insurance premiums and road tax so don’t get stuck with something that you, in all probability, do not need.
If you have had someone trying a hard sell on Gap Insurance recently then let us know – we’re listening!

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