Mini Shortfall Insurance

[Sharpingtons]

I'm awaiting delivery of an MCS in early January ( ), and have been offered Mini 'Shortfall insurance'. I gather this is supposed to cover the difference between insurance valuation and new price should the worst happen - ie written off. Something to do with insurance companies not recognising the upgraded spec possibilities. I've ticked quite a few options boxes so am slightly concerned by it!

Anyone else out there have this cover, not have this, or wished they'd had this!

[xdot]

Hi,

I got my MCS last month and opted for the shortfall cover.
As I understand it, it works like this (if I'm wrong I'm sure someone will tell me!).

You pay 20k for your nice new shiny car with loads of bits on it. Unfortunately you write it off in the 3rd year of ownership and your insurers say that according to the market value it's now only worth 12k. This obviously leaves you with a bit of a problem if you want to replace the car with the same spec. Therefore the shortfall insurance kicks in and your dealer will top up the payout to the price you paid originally - 20k.

As for the options question - this really depends on the insurer - some cover them, most don't and if you do a search on "elephant.co.uk" you'll find loads of stuff on this topic

If you've got a highly spec'd car I think for another 250 odd quid it's probably worth it IMO.

Hope this helps. Good luck with the wait for delivery (it doesn't get any easier!)

[scooperman_uk]

its not necessarily to cover the issue of insurance companies not recognising the upgrade specs. Its more to do with still having finance on the vehicle and the payment you receieve is less that value of the vehicle (i depreciated value). so it leaves you in a loss situation. i..e you use the payment from the insurance to settle the outstanding finance. however the gap is created as you dont have enough money from the payment. if you are worried about this. i.e. you have a huge financial commitment left in terms of payment left on the car, then take it. however if you have put a large deposit down then look at the costs of the gap cover and work out if its worth it.

if your worried about insurance not paying out for mods then get insurance that covers all the mods and doesnt replace with a standard car. BWM insurance for example covers CHILLI and JCW mods. so will payout on the value. its normal for a company to replace the car if its totalled in the first 6 months with a brand new vehicle.

however i cant comment on using it as i didnt take it.

hope that helps. do a search theres a few threads on this already.

[Sharpingtons]

Thanks both of you!!

Have decided to go with it. There is a lot of finance involved, so it's best to make sure that I'm not left with a problem if something should happen.

As far as the waiting is concerned, it's the longest three months i've ever had to endure!!!!

[randap]

Don't forget, shortfall insurance by Mini / BMW also covers any increase in the price of a new car. For example, if you bought a MINI at £16,000 new, and wrote it off in your 3rd year - your insurance company would pay out the market value, say £7000. If the cost of a same spec car was now £17,000, shortfall would cover the outstanding £10,000.

As I see it, it is a small cost for peace of mind - I think of it as having all financial risk of car ownership being removed. I have 3 years to pay on finance, but I have 4 years shortfall, hence no risk.

You also don't have to worry about having to squeeze more money out of your insurance company, because thay undervalue your MINI. Shortfall covers it all, and you can get a shiny new car if the worst should happen....

Remember, shortfall only applies in total loss situations.

[scooperman_uk]

total loss shudder ..... insurance companies just love to repair in preference to replace