VRI Gap Insurance or Vehicle Replacement Insurance
What is Vehicle Replacement Insurance and what can it do for you?
Vehicle Replacement Insurance is possibly the most comprehensive style of Gap Insurance in the UK today. VRI pays the difference between your vehicles valuation on the day it is written off and the amount of money you would need to spend to buy another vehicle the same age, mileage and condition as your was on the day you collected it from the dealership.
Almost like a return to invoice level of cover but with an added inflation proof aspect. This is because a standard Return to Invoice cover would only give you back the original price you paid, so what if the equivalent vehicle is now thousands of pounds more to replace?
After all increases in labour, manufacturer, transportation and inflation can have a huge affect on the price we pay for our vehicles.
This is why VRI Gap Insurance is almost like return to invoice but instead you are now not simply protecting the invoice price you paid but the level of vehicle.
The easiest way to think of this type of gap insurance is that is performs similar to "new for old " home contents insurance. Replacement Gap Insurance is a real 'inflation proof' gap insurance, as well as protecting against depreciation, like RTI Gap Insurance.
So what if VAT rises?, well the VAT rise in January 2011 put approximately £500 on the cost of a £15,000 new car.
So what if the manufacturer puts the cost of new cars up again? Transportation costs and increased manufacturing costs, coupled with exchange rate fluctuations can effect this.
If your vehicle is 'written off' you still have to replace it!
If your vehicle is written off and the cost of a replacement vehicle, equivalent to the yours when you bought the Gap Insurance policy, has risen by a few thousand pounds what could you do? Not only do you suffer with the loss on the purchase price, you may have quite a shortfall to make up to the invoice price of a replacement vehicle. Insurance companies simply do not cover these factors in normal car insurance, and despite the fact you have 'comprehensive' cover, a total loss can present quite a shock with the insurance payout.
Do really want to buy a pre owned / second hand model or dig deep into your savings perhaps? However, if cover yourself with VRI Gap Insurance ,and providing you have chosen a realistic claim limit to cover any increase in future costs, this really can be the gap insurance to beat all others. Other forms of car gap cover, like RTI, RTV or Finance simply do not go this far.
Don't forget depending upon the claim limit you set Replacement Gap insurance is probably the most comprehensive gap cover, no wonder it is now our most popular choice for our EasyGap customers. In most cases an extra £10,000 worth of cover will give you extra peace of mind and the cost will be negligible. Let me try and explain, for illustration purposes we have taken one of the most popular vehicles sold in the UK at present.
- You have bought a new or nearly new Ford Focus, and you paid £16080
- Less deposit £1000
- You borrow £15080 on a finance agreement
- You buy vehicle replacement insurance and set your claim limit at £10,000
- In 12 months time the vehicle is written off. Glass Guide retail is £10350
- You get a good settlement from your insurer of £10600
Wait !!! You still owe £12800 and they don't build that model anymore. The equivalent car is now £17600 !!!!
Vehicle Replacement Gap pays difference between your insurance settlement and the cost of the new car. In this case vehicle replacement insurance would pay £7250. You still have no car but you now have the money to clear your finance and have £4800 for a good deposit for another car. Without VRI you are left without a car which you still have to pay for. Even worse you may have to re-finance the difference. With prices for three year VRI gap cover from £99 can you afford not to protect your investment,
As with any insurance policy Vehicle Replacement will come with some exclusions so why not call and see how VRI cover can work for you?
At EasyGap we never compromise on levels of security, cover and policy features and neither should you. All our VRI Gap policies cover the cost of the replacement vehicle, or the nearest equivalent model should that model not be available. If that price is more than the original invoice price you paid, then so be it!
You can also buy VRI gap insurance for an number of different types of vehicles
At Easy Gap we can provide Vehicle Replacement Insurance for a range of vehicles, for up to 5 years. We can provide VRI Gap for Cars, Vans, Motor Homes, Motorbikes, Taxi's and Driving School vehicles, and all underwritten by UK General on behalf of Ageas, Ageas are one of the largest insurers in the UK today.
Remember also that if you do buy a Combined Vehicle Replacement Policy, and you do change the vehicle within the policy period, you can transfer the balance of your cover to a new vehicle FREE OF CHARGE! Unlike some other gap products in the market, the chance to transfer free is written in black and white, in the policy terms.
If you have any questions please call 0800 195 4926 or buy vehicle replacement gap insurance online.
- How does the Cover Work?
- Show Me An Example
- EasyGap VRI Features
- Making a VRI Claim Video
- How VRI Works Video
- Who is Covered On Your Policy
Vehicle Replacement insurance pays the difference between your vehicles valuation on the day it is written off and the amount of money you would need to spend to buy another vehicle the same age mileage and condition as yours was on the day you collected it from the dealership even if the price has gone up.
If that model is no longer available then settlement would be based on the superseding model.
For example you buy a vehicle today on a special offer where the manufacture is paying the VAT and spend £18000.
Three years later your vehicle is written off and your own insurance company offer you the value of your vehicle which based on average rates of depreciation is £9,000.
Without any form of protection this is the only amount you would have to be able to replace your vehicle or clear any outstanding finance..
With a standard form of return to invoice your gap insurance policy would now make a second payment which would be the difference between your own insurance companies settlement and the original invoice price you paid ( £9,000).
The problem is that times change, prices increase and the manufacture no longer has the special offer in fact they have just face lifted the model and the same like for like vehicle would now cost £23,000.
With a form of vehicle replacement you would now instead be paid the difference between your vehicles valuation and the amount of money that you would need to spend to buy another vehicle which in this example would be
£23000 new vehicle
-£9,000 from your own insurance company
= £14,000 vehicle replacement insurance.
In essence between your two insurance companies you know have the full replacement cost. You can clear any outstanding finance and the chunk in the middle, the deposit and the equity and now the increased cost is yours to do with as you see fit.
In 2010 you bought a Volkswagen Golf 1.4 s 5Door and paid £14150.00
Two years later you golf skids on black ice and while no one is hurt you Golf performs fantastically and absorbs the impact to the extent where your own insurance company decide to write the Golf off. They duly offer you the market value which according to what car deprecations calculator is £9010.00
No matter how you have paid for you Golf you now only have £9010.00 to replace your car or clear any outstanding finance.
To make matters worse Volkswagen have changed the engines and the new Golf S 1.4 is no longer available as it has now been replaced with a leaner, meaner more fuel efficient 1.2 TS1. Unfortunately the price has also risen to £17880 on the road.
In this example a vehicle replacement insurance would pay the difference between your own motor insurance companies settlement the £9010 and the £17880 that you would need to spend to buy another new Golf.
This means that you would now have the full purchase price ( less road fund ) which you could use to clear any outstanding finance and the surplus amount , the deposit you original paid and the equity you have is yours to do with as you see fit.
Remember that at easy Gap we will never source a vehicle for you and all of our Easy Gap Vehicle Replacement policies will only ever pay you the funds. If you want the same vehicle again, no problem you have the funds to do so, if you want something else that is your choice. After all it is your vehicle replacement insurance, your vehicle that was written off and shouldn't it be your choice how you spend your money!
Instead you are always paid the cash equivalent as we believe that this puts you in the driving seat about where and how your money is spent. You may want the same vehicle again however you may not and we believe that it should be your choice.
You will also be pleased to know that there are many many more features for example all of our policies cover
The cost of Non-Transferable Warranties
The cost of paint protection
The cost of all Factory Fitted Options
The Cost of up to £1500 worth of dealer fitted accessories
We pay £250 towards the cost of your own motor insurance excess
You can defer the start date of your policy for up to 12 months free of charge
You have free of charge accident management
You can cancel your policy within 30 days for a full refund
You can cancel after 30 days and get a pro rata refund
All policies are Fully FSA Regulated
All policies are backed by the financial services compensation scheme
All Policies are underwritten by Ageas UK
If fact there are many many more policy features so why not click or call 0800 195 4926 and discuss just how a vehicle replacement insurance policy from easy gap could help protect you?
With this in mind you will be pleased to know...
Easy Gap vehicle replacement insurance has been benchmarked with replacement policies across the UK by independent financial research and software company Defaqto, and has received a 5 Star Rating.
If you are considering a form of vehicle replacement we would ask you to remember that when it comes to picking a claim limit you will not only need to allow enough room for the depreciation of your own car but also the appreciation of the cost of a new one.
If the average vehicle can lose up to 50% within the first three years alone then a 50 % claim limit may be more than adequate for a return to invoice style of cover but it would not be big enough for a vehicle replacement policy to perform. We would therefore always ask you to air on the side of caution and remind you that if you are in any doubt or need any assistance out team our always here to help.
You can Buy vehicle replacement gap insurance for vans, cars, motor homes, motorbikes, taxis and driving school vehicles.
No matter if you want to buy gap insurance for your company car, your business van or your motor home or motor bike we are here to help every step of the way from the purchase of your policy to claim we are only ever a click or a call away.