Buyers are duped by claims that FSA rules require they are told of gap policies. Miles Brignall reports. 

Saturday March 10, 2007

The Guardian 

Commission-hungry salesmen are making new car buyers sit through sales pitches for insurance by falsely claiming that Financial Services Authority rules require it.

Several buyers have reported the trend. As they sign for their new car, the salesman tells them that recently introduced FSA rules require that they tell them about gap insurance. The FSA told Guardian Money this week that no such compulsion exists.

Salesmen have long realised that buyers can be a soft touch when they pick up a new car. Gap insurance is mostly sold to buyers who take out hire-purchase agreements. The fact that cars depreciate rapidly in the first few months can mean the insurance payout on a six-month-old car can be less than the finance still owed - if the car is written off. Gap insurance covers the difference.

Money > Insurance > More on motor insurance 

Salesmen use legal compulsion ruse to flog car cover

Buyers are duped by claims that FSA rules require they are told of gap policies. Miles Brignall reports. 

Saturday March 10, 2007

The Guardian 

Commission-hungry salesmen are making new car buyers sit through sales pitches for insurance by falsely claiming that Financial Services Authority rules require it.

Several buyers have reported the trend. As they sign for their new car, the salesman tells them that recently introduced FSA rules require that they tell them about gap insurance. The FSA told Guardian Money this week that no such compulsion exists.

Salesmen have long realised that buyers can be a soft touch when they pick up a new car. Gap insurance is mostly sold to buyers who take out hire-purchase agreements. The fact that cars depreciate rapidly in the first few months can mean the insurance payout on a six-month-old car can be less than the finance still owed - if the car is written off. Gap insurance covers the difference.

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