Car dealers urged to ensure GAP insurance rules compliance
The NFDA has urged dealers to ensure their compliance with new regulations governing the way in which Guaranteed Asset Protection (GAP) insurance is sold to consumers. Set out by the Financial Conduct Authority (FCA), the new rules are due to come into effect on 1 September 2015. Dealers will be required to explain that customers must return to the dealership four days after purchasing their car if they want GAP insurance.
The regulations will force consumers to delay acquiring GAP products and will be unable to conclude a purchase at the same time as they are arranging to buy a car. The NFDA contends that the regulations will be damaging for car dealers’ business and create unnecessary delays for consumers. Dealers will also be required to give customers ‘Prescribed Information’ about the GAP products they are being offered.
Sue Robinson, director of the NFDA, which represents commercial vehicle and franchised car retailers across the UK, said: “The new rules taking effect on 1 September will have a major impact on the way in which a motor dealer sells GAP insurance. It represents a significant change to the industry, whereby we have to change the way this product is sold, which for most dealers generates an important revenue stream.”