3 In 4 UK Motorists Have Inadequate Car Insurance

ALA, an independent insurance broker, recently learned that over three quarters of motorists in Britain do not have adequate auto insurance coverage for theft or accidents. Either of these situations are nightmares in themselves.

When insurance coverage is insufficient, the event reaches another level of bad. However, there is an easy way to correct the problem.

In its Mind the Gap survey, the ALA found that 77 percent of UK motorists are not protected against the shortfall between the invoice price, outstanding car finance, or replacement cost of the vehicle and its market value.

Guaranteed Asset Protection, or GAP, insurance can be used to cover the difference. It provides complete coverage for the full value of the vehicle should a loss occur.

The survey of 2,055 adults in Britain revealed that car loans were held by ten percent and eleven percent of vehicle owners used hire purchase. Both of these groups risk costly repayments if their cars are wrecked or stolen.

According to the study, 25 to 34 year olds have the highest level of risk. Fourteen percent used car finance to purchase their current car and 16 percent took out personal or car loans.

Ten percent of those surveyed said their car was written off due to accident, and six percent had their car stolen, within the past year. This illustrates the large segment of the market that is exposed to expensive repayments without GAP insurance.

Automobiles quickly depreciate in value and insurance excesses are rising. This may cause claim costs to become even higher.

Though GAP insurance provides financial relief, consumers should not purchase the first plan they find. Shopping around for coverage is recommended and purchasing from an independent broker may be less expensive than dealer-provided coverage.

Consumers should make haste to protect themselves because an accident or theft usually comes without warning.