The Value of GAP Insurance When Buying a Car
This article contains data provided by my sponsor, ALA Insurance (use code JIM10 for 10% off GAP insurance). The figures and examples below are based on actual GAP insurance claims made by ALA customers.
Buying a car is exciting, but few people think about what would happen if their car was written off or stolen. Standard motor insurance will only pay out the market value at the time of loss, which can be thousands less than what you originally paid. That’s where GAP (Guaranteed Asset Protection) insurance comes in – covering the difference and protecting you from a serious financial hit.
The Numbers Behind GAP Insurance
Looking at ALA’s recent claims data gives us a clear picture of how valuable GAP insurance really is:
2022 – Average payout: £6,716.93
2023 – Average payout: £6,117.16
2024 – Average payout: £3,492.68
The average payout dropped in 2024, not because cars are losing value more slowly, but because there were fewer claims overall. Crucially, the range of payouts is still huge – from just a few thousand pounds to well over £40,000.
This means that while some drivers claim relatively modest amounts, others would face life-changing losses without GAP insurance.
GAP Insurance can help protect you against a serious financial hit if the worst were to happen
Real GAP Claims: A Wide Range of Payouts
Here are some real examples from recent ALA claims to show how varied the payouts can be:
A Range Rover Evoque bought for £20,500 (2022) generated a GAP payout of £10,439.75.
A BMW X7 X Drive, purchased for £60,000 (2023), saw a £14,636.00 payout.
A Range Rover Sport SVR bought in 2022 for £95,000 needed a massive £41,460.00 payout.
A BMW iX bought in late 2022 for £86,000 generated the largest payout here – £50,000.00.
Even a more affordable car, the Tesla Model 3 Standard Range (£43,499 in 2021), saw a £26,153.83 payout.
What these examples show is simple: it doesn’t matter whether your car cost £20,000 or £95,000 – depreciation and insurance shortfalls can hit hard.
Why GAP Insurance Matters
Cars lose value quickly – especially in the first 2–3 years.
High-value and premium cars often have the steepest depreciation curves.
Finance and leasing customers risk being left paying off a car they no longer have.
Peace of mind – knowing you won’t be out of pocket if the worst happens.
Should You Consider GAP Insurance?
If you’re buying a new or nearly new car, GAP insurance makes a lot of sense. The average payout data proves that even in years with fewer claims, customers are still receiving thousands of pounds in protection.
And as the claim examples highlight, some drivers would have been left tens of thousands of pounds short if they didn’t have GAP cover.
👉 To see what cover is available for your car, check out ALA Insurance and don’t forget to use code JIM10 at checkout for 10% off.