Volkswagen Financial Services has launched two GAP insurance schemes, designed to protect car buyers against financial loss if their vehicle is stolen or written-off.

If either happens an insurance company will typically offer a total loss payment based on the market value of the car at the time. This can be less than either the cash price of the car or the outstanding finance on it. GAP insurance is meant to make up the shortfall.

There are two types of policy from VWFS. First, GAP (Shortfall Protection) covering the difference between the insurer offer and the balance of an outstanding VWFS agreement, up to £10,000.

GAP Plus (Return to Invoice) offers the same coverage, but up to £15,000. Unlike the first policy this is available with or without a VWFS finance agreement.

Both policies must be combined with fully comprehensive motor insurance and is available with new and used cars.