Here’s an example of how Return to Invoice GAP Insurance works.
Your car, which came with an invoice for £20,000, has just been written off. Boo.
At the time of your claim, you owed £21,000 to the finance company.
The normal comprehensive market value insurance payout you’d get might be something like £15,000 – the secondhand value of the car at the time of the claim. It’s scary, but that’s how car insurance works. Maybe you didn’t know that.
Depending on whichever of those two amounts is higher at the time of the claim, Return to Invoice Insurance either pays the finance company the money you owe them, leaving you debt-free on the transaction, or pays you back to the original invoice amount, which in this case was £20,000.
In this case, the higher of the two amounts is the £21,000 you owe to the finance company, so you’d get a £6,000 payout from the Return to Invoice Insurance on top of the £15,000 market value insurance payout, making a total of £21,000.
If, on the other hand, you owed just £18,000 to the finance company, you’d get your £15k market value payout plus £5,000 from the RTI to take you back to the £20,000 invoice price. This is the good bit. After paying up the £18,000 outstanding finance, you’ll have £2,000 over. That’s yours to blow on a nice holiday, or whatever else you fancy. Result.