Definition of Market Value, means the greater of: (a) The value of the Insured Vehicle (excluding contents) at the Date of Loss as assessed by the insurers of the Motor Insurance; or (b) The Market Value of the Insured Vehicle (excluding contents) as at the date of Loss by reference to Glass’s Guide Retail Value.
Definition of Net Invoice Price means the price paid by the Insured for the Insured Vehicle including all factory - or dealer-fitted options specified in the Insured Vehicle’s manufacturer’s price list, and any discount given but excluding the price paid for accessories and extras, road fund licence, new vehicle registration fee, fuel, paintwork and upholstery protection kits, insurance or warranty premiums (including the premium for this policy) and any Negative Equity.
If the vehicle you are buying is later the subject of accidental damage, fire or theft and ‘written off’ by your Motor Insurer, you could be faced with a financial ‘gap’ between the Market Value of your written off vehicle and the Net Invoice Price. If the settlement figure on the finance agreement is greater than the Net Invoice Price the benefit will be calculated using the finance settlement figures and this will be paid direct to your finance company on your behalf (Purchase Protection), or Purchase Protection offers cover for this risk.
It covers the ‘gap’ between the Net Invoice Price or finance settlement (whichever is greater) and the Market Value. Cover lasts for up to 36 months. The Net Invoice Price will be shown on the Certificate of Cover. It may not be the same figure as the total amount that you have paid as it relates to the vehicle itself, it does not include non-dealer fitted options and extras such as the Road Fund Licence.
In addition, if your vehicle is subject to a finance agreement in month 37 to 48, Purchase Protection could cover any shortfall between the finance settlement figure and the Market Value if your vehicle is written off.
If you wish to understand more about the way in which the ‘gap’ is calculated, you should read the definitions section of the Terms and Conditions.