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Total Loss Lease & Contract Hire Gap Insurance


Have you secured your new vehicle via a lease or contract hire agreement where you have no option to own the vehicle as part of the lease terms? If that is the case then under the terms of your lease you may be liable, in the event of a total loss or 'write off' by your insurer, for any difference between the motor insurer's settlement and the lease settlement at that time.


This is where Lease Gap Insurance from Total Loss Gap can come in.


With a Total Loss Lease Gap Insurance policy, you can claim the difference between any shortfall between the motor insurer's settlement and the amount your lease requires you to pay at that point.


How does that work in practice? Let us show you an example.Total Loss Lease Gap Insurance with Deposit Protection


Let us say you take a new 66 plate BMW 520d M Sport 4dr Step Auto. The lease is a Contract Hire type, with no option to own the vehicle at the end.


The lease is over 3 years, 10,000 miles per annum and has an initial deposit rental of £1500+VAT and then 35 further rentals of £254 + VAT per month.


12 months after taking the lease out your vehicle is in an accident or stolen, and the motor insurer declares the vehicle a total loss. They determine the market value at that time is now £25,000. The leasing company wants £28,500 to clear the lease at that time.


This leaves you with a shortfall on the lease of £3,500 and of course, you have also paid £1500+VAT as an initial deposit rental.


If you have a Total Loss Lease Gap Insurance then the shortfall of £3,500 on the lease can be met. This means you have no further payments to find to clear the lease off.


If you have taken the additional option of lease deposit protection then you can claim back the deposit you have paid on the lease also. This means you have the deposit back to put down on a replacement vehicle on a new lease agreement.



What is Lease Gap Insurance Deposit Protection?


When you take out a contract hire lease agreement you will normally be asked to pay an initial rental or deposit rental. This is typically 3, 6 or 9 months rentals as the first payment. This is taken as, or soon after you get delivery of the new vehicle.


The big issue with traditional Finance and Contract Hire styles of Gap Insurance has always been that you have never been able to recover this deposit if you made a claim. It may be great that the original lease is paid off but you will then have to find another deposit to put down on another vehicle lease. Of course, this may be even more infuriating if the incident that has caused the vehicle to be declared a total loss happens early in the lease. You may be in a situation where you have to find another substantial sum of money very soon after putting down your deposit on the first vehicle in having to replace it.


With the Optional Deposit Protection from Total Loss Gap then you can claim back up to £3000 of that initial rental separately. This will mean you have paid off the lease with the standard Gap Insurance and then claimed your deposit rental back to put down on another vehicle.



Why is Lease Gap Insurance from Total Loss Gap different?


Well in essence, it is just much simpler. With most Gap Insurance providers you have to provide a P11d value, or approximate purchase value, an estimate of what claim limit you may require and the length of cover to get a quote. The problem there may be that you do not know the value of the vehicle as you have never purchased it. Also knowing how to calculate what claim limit you may need can be tricky as you may need to know the requirements of your lease settlement before you can understand how much cover you need. This could leave you annoyingly overinsured or worryingly underinsured without full knowledge of these details.


With Lease Gap from we need nothing like this level of detail and knowledge from yourself.


As long as you can confirm that the vehicle does not exceed the £75,000 purchase value threshold of our Gap products then all we need to give you a quote and full cover are confirmation of:


  • your monthly rental
  • the number of years cover you need


That is it. Simple, isn't it?


In return, we can provide you with a quote to cover any shortfall on your lease (no claim limit applies) and give you the option to cover up to £3000 of your deposit rental paid. The policy can also cover up to the first £250 of your motor insurers excess deduction from a total loss settlement to you also.


Why is this better than traditional Finance and Contract Hire Gap Insurance?


Putting aside the simplicity factor, the premium price you are paying is based on your lease payments and not the value of the vehicle. This means that a situation where you pay a rental of £250 per month on a £40,000 vehicle or £250 per month on a £20,000 vehicle (this can happen where one vehicle can be secured by the leasing company at a much better discount or have a better residual value) then you would pay the same premium to cover. The initial value of the vehicle is a poor metric to consider when looking at Contract Hire Gap Insurance as it bears little significance in determining your lease settlement.


You may also have structured your lease with a larger initial deposit rental to lower your monthly rentals from then on. Without the option of deposit protection, you may see a lower premium for the Gap but no chance of protecting that deposit. With Total Loss Lease Gap Insurance, you can cover both if you wish.


So to clarify if you want to cover your Contract Hire Lease then a Lease Gap Insurance from can cover:


  • the shortfall from your motor insurers settlement to the lease settlement (eg outstanding rentals) with NO CLAIM LIMIT
  • the OPTION to cover up to £3000 of initial rental/deposit
  • up to £250 of your motor insurers excess deduction from a total loss claim


All we need from you is your monthly rental and the number of years for your lease and that is enough to get a quotation and cover today!


How to get a quote for Total Loss Lease Gap Insurance


1 - You can access a quote for our Contract Hire Gap cover by going through the normal Gap Insurance quotation button. You will be taken to our question section and you simply answer the questions in sequence regarding aspects such as vehicle use etc.



Total Loss Lease Gap Insurance Quote


2 - You will then come to a question that states: How did you pay for your vehicle?       



Here you would select either 'Contract Hire' or 'Lease Hire'




3 - You will then see a question that states : Do you have the option to own your vehicle at the end of your finance agreement if you wanted?



Here you select 'No'                                  Total Loss Gap Insurance lease gap quote








4 - You will then be asked : Do you have a deposit/initial rental that you would like your Gap Insurance policy to protect?Total Loss Gap Lease quotation




You can select 'yes' if you would like your quote to include up to £3000 deposit protection or 'no' if you would not





5 - You will now be taken to the 'Build your Quote' page.


Here we just need two things from you:


6 - In the left-hand box, under the red 'Build your quote' button please simply enter your monthly rental (inc VAT) and the number of years cover you need.

Total loss lease gap insurance quotation


7 - Once these have been entered you will see the fully inclusive premium appear in the adjacent box.


You can read the full policy terms by clicking the 'View policy' button, the KeyFacts summary by clicking 'KeyFacts' or an example of how the policy works by clicking 'View example'.


Should you wish to proceed to buy the policy simply click the green 'Add to Basket' button and your policy will appear in the basket on the right-hand side. If you wish to continue to purchase you can simply click the red 'Checkout' button and the process will continue to the purchase pages.


We try to make sure every policy we provide is as 'all inclusive' and simple as possible. We think you will agree that if you are looking for a Contract Hire style Gap then Total Loss Lease Gap Insurance really does tick every box! Total Loss Lease Gap Insurance




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