Customer initiates the conclusion of the contract
A GAP contract can be concluded faster – on the day after the prescribed information has been provided – if the customer initiates the conclusion of the contract, and confirms that they understand, and accept, that they are choosing not to be subject to the deferred opt-in period.
GAP premiums funded by the finance agreement
It is not uncommon for the payment of GAP and other insurance products to be packaged as part of the monthly finance payment i.e. the customer would pay a single regular monthly payment which includes repayment of the loan and GAP premium. The new rules make no exceptions for GAP policies structured in this way and would require the total cost of GAP to be provided under the prescribed information and a deferred opt-in period to be implemented prior to the conclusion of the GAP agreement.
Intended outcome of the remedies
The rules no longer allow GAP insurance to be sold on the same day the customer enters the dealership. This gives customers time to read the prescribed information, compare features of a policy and its cost against alternatives offered by other providers before concluding the sale. The FCA therefore aims to empower customers when making decisions about purchasing GAP insurance and increase competition between GAP insurance providers resulting in better customer outcomes.