The Financial Conduct Authority (FCA) recently published its final report in to the sale of add-on insurance policies, part of which included a rather damning review of how motor dealers "sell" GAP insurance.
Of those consumers who bought GAP insurance as an add-on from the motor dealer, the FCA found that 59% of consumers had not thought about buying GAP insurance until the day they bought it. Almost half were not aware that they could have bought the GAP insurance elsewhere. Only 19% said they'd shopped around and 15% reported experiencing a little pressure to buy the product.
In addition, the FCA's market study found that consumers who bought GAP insurance as an add-on from the motor dealer had a worse understanding of the product than those that bought GAP insurance on a standalone basis.
Moreover, typically add-on and stand-alone GAP insurance products offered similar levels of cover but in most cases add-on GAP insurance policies...