Search

Asset Protection Insurance (API)

What is Asset Protection Insurance?

Asset Protection Insurance is an additional insurance policy that pays out the difference between the price you paid for your car and how much it is worth at the time, in the event it is stolen or written off in an accident.

How does it work?

In the event your car is stolen or written off and declared a total loss by your insurance company, they will pay you the market value at the time, not the amount you originally paid for it. This can often be a substantially lower amount, as cars generally depreciate in value over time.

API pays you the difference between the two figures, giving you the funds to replace your car with a model of the same value, without having to make up the difference yourself or through additional financing.

Example

  • You purchase a new or used car at a cost of £25,000.
  • During your ownership, it is involved in a road traffic collision and declared a total loss by your insurance company.
  • They agree to pay you £17,000 for the insurance claim, which at the time is an accurate market value of the car.
  • If you have taken out Asset Protection Insurance, and you are within the policy schedule, you will be paid the difference between the price you paid for the car and the amount paid to you by your insurance company for the claim. In this example, it is £8,000.
  • As you now have £25,000 again, you can purchase a vehicle of the same value without using any more of your own funds.
Can I just take out API instead of normal vehicle insurance?

No, you will still need vehicle insurance as required by law. API policies stipulate that you must have comprehensive insurance.

Are cars used for commercial activities eligible for API?

No, only vehicles used privately on public highways are eligible for API cover.

How does API work with cars that are on finance?

In the event your vehicle is stolen or declared a total loss, the money paid out by the API policy will assist you in settling the finance on that vehicle. Without API, you would owe the finance company the difference between the market value of the car and any remaining finance balance.

Helpful Documents