Does GAP Insurance Cover Voluntary Termination of PCP or a Lease?

No. GAP Insurance does not cover voluntary termination of PCP or lease agreements. GAP is designed to protect you if your car is written off or stolen, not if you decide to hand the car back or end the agreement early.

Why excluded · What GAP does cover · What to do if ending early · Related links

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Voluntary termination of a lease or PCP occurs when you end your agreement early and return the vehicle to the leasing or finance company. Although the finance company has the value of the car back, there could still be a shortfall to settle the lease or PCP.

Why voluntary termination is excluded from GAP Cover

Voluntary termination is a choice made by the driver under their finance rights, not a loss event.
GAP only activates after a total loss claim from your motor insurer (e.g. theft or write-off).
Ending a finance deal early creates no “gap” for GAP Insurance to cover.
A separate insurance called Early Termination Insurance exists for that purpose, which is separate and unconnected to GAP Insurance.

What GAP does cover

If the car is written off, GAP pays the difference between the insurer payout and the finance balance, invoice, or replacement cost (depending on policy type).
If the car is stolen and not recovered, GAP applies in the same way.
These are the only qualifying scenarios; voluntary termination is excluded.

What to do if ending early

If you voluntarily terminate, you’ll need to settle according to the Consumer Credit Act rules or lease terms.
You may be due a refund on your GAP Insurance if you no longer need the policy.
Always notify your GAP provider if you end finance or lease early.

Tip: If you’re considering ending your PCP or lease early, speak to the finance company first to understand your obligations.