GAP insurers suspend sales after FCA concerns on fair value

Insurers covering 80% of the guaranteed asset protection market have agreed to pause sales after a request from the Financial Conduct Authority, the regulator has confirmed.

GAP insurance is typically sold alongside car finance and the FCA is worried the product is failing to provide fair value to some consumers.

GAP insurance can provide a useful service to customers, but in its current form it does not offer fair value and we want to see improvements.Sheldon Mills, FCA

However, the regulator warned of concerns with the design of GAP insurance across all distribution channels as it demanded changes.

It committed to considering proposals for different distribution

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