Spiel blurb production

When I took delivery of my new BMW X1 I was given a hard sell in respect of this "Shortfall Insurance". If the vehicle is a total loss in the 4 years of the cover, it pays up to £10k of any shortfall between the insurance proceeds and the cost of a new vehicle. Given that most policies pay out on a new for old basis in the first year of ownership and the remoteness of the risk of total loss, the cost seems to me exorbitant. A premium of £39 would be more like it. I was coerced into sitting through the sales pitch by being told that the FSA insisted on it: complete rubbish. Any thoughts?

Asked on 5 June 2010 by RB, via email

Answered by Honest John

If you let them start, the FSA insists you sit through the whole thing. If you don't let them start, they can't make you listen. GAP insurance would normally be about £100 via an insurance broker. This is one of the few ways a car salesman can earn a £300 commission these days. Another is paint protection. Your best defence is to charge the salesmen for your time, at the same rate as their workshop labour.

Tags: gap insurance insurance legal issues policies

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