Add on Products in Car Finance: GAP Insurance, Warranties, and Unfair Pressure Selling

When you’re sorting car finance, it’s easy to focus on the big numbers — the monthly payment, the deposit, and whether the deal “fits”. But for a lot of drivers, the money leak isn’t the car itself. It’s the add-ons that get bundled in at the last minute: GAP insurance, extended warranties, service plans, tyre cover, paint protection, and “admin” extras you didn’t go in to buy.

Some add-ons are genuinely useful. The problem is how they’re sold — rushed, bundled, or pushed as if you’ve got no choice.

This article helps you spot what’s normal, what’s not, and when “extras” can become unfair pressure selling.

What are car finance add-ons?

Add-ons are optional products sold alongside your finance agreement. They’re usually presented as “peace of mind” or “protection”, and they can be paid:

• upfront, or

• added to your finance agreement (so you pay interest on them too)

That second option is where things quietly get expensive. A “small” add-on can turn into a much bigger cost once it’s spread across 3–5 years at the same APR as the car.

If you’re not sure what you agreed to, your starting point is always your paperwork — and if you want to understand your options, Claim First explains the basics on Mis-Sold Finance Claims.

GAP insurance: what it is, and why the FCA has focused on it

GAP (Guaranteed Asset Protection) is designed to cover the difference between what your insurer pays out if your car is written off and what you still owe (or what you paid). In plain terms: it’s meant to stop you being left short after a total loss.

Here’s the important bit: the UK regulator has raised serious concerns about fair value in the GAP market. In February 2024, the FCA said multiple firms agreed to pause selling GAP insurance following concerns about whether the product offered fair value.

That doesn’t mean GAP is always “bad”. It means you shouldn’t be rushed into it, especially not at the point of sale when you’re already under pressure to sign.

Where GAP selling can go wrong

• You’re told it’s “required” to get finance (it isn’t)

• You’re told it must be bought today or you’ll lose the deal

• The cost is bundled into the monthly payment so you don’t notice it

• You’re not told you can shop around

If anything about the sales pitch felt like pressure rather than choice, it’s worth checking what you signed and what you were told at the time.

Extended warranties: helpful cover or expensive upsell?

Extended warranties can be useful if:

• you’re keeping the car longer

• you’re worried about repair bills

• the cover is clear and genuinely fits your car

But they’re also one of the most commonly over-sold add-ons — because “what if something goes wrong?” is a powerful nudge.

The common “misleading” moments

• The warranty is presented as bumper-to-bumper, but exclusions swallow the cover

• You’re told the manufacturer warranty is “basically useless” (often not true)

• You’re pushed into the most expensive tier without being offered options

• You’re not given the full terms before signing

And again, if the warranty is added to finance, you’re paying interest on it as well.

Quick example (rounded):
If a warranty costs £700 and it’s added to a 4-year agreement, you’re not just paying £700 — you’re paying £700 + interest over the term. That’s why it’s so important to know what’s in your monthly payment.

Pressure selling: what it looks like in real life

Pressure selling is rarely someone shouting at you. It’s usually subtle:

• “Everyone takes this.”

• “The lender requires it.”

• “It’s only £12 a month.” (without saying what it totals)

• “If you don’t take it, you’re exposed.”

• “We can only approve the deal with these protections in place.”

You should always be given the chance to:

• say no

• take time to think

• compare alternatives

• understand what you’re paying, in pounds and pence

If you felt rushed, confused, or boxed in, that’s a red flag.

Bundling: when add-ons get hidden inside “the deal”

A really common issue is bundling. Instead of quoting:

• car price

• finance amount

• add-on cost

…everything gets rolled into one monthly number.

So you think you’re agreeing to finance for the car, but you’re actually financing:

• the car

• GAP

• warranty

• service plan

• tyre cover

• paint/interior protection

• fees

If you’re looking back at your agreement now and thinking, “I don’t remember agreeing to half of this”, you’re not alone — and that’s exactly why these cases exist.

A key UK stat that shows how big “add-on selling” really was

This isn’t a niche problem. The FCA’s own evaluation of its GAP insurance intervention referenced 600,000 add-on GAP sales a year in its pre-intervention cost-benefit analysis.

When products are sold at that scale, even a small percentage of unfair sales practices affects a lot of people and a lot of money.

What you can do right now if you’re worried

If you’re still in the agreement (or even if it’s finished), here’s a practical checklist:

1) Pull your agreement and look for extras

Scan for words like: GAP, warranty, service plan, tyre and alloy, paint protection, maintenance, insurance add-on.

2) Check whether they were financed

If the add-on cost is included in the amount borrowed, you likely paid interest on it.

3) Ask yourself how it was sold

Were you told it was optional? Were you given time? Were the costs explained clearly in £?

4) Save any messages or paperwork

Emails, finance summaries, order forms, and screenshots all help build a clearer picture.

If you want to understand how Claim First handles these situations (without drowning you in legal jargon), start with FAQ'S and then look at Our Services.

Where Claim First fits in

Claim First is set up to make claims simple: you share the basics, and the team handles the heavy lifting. If you want to see how other people have found the process, have a look at Testimonials.

Next steps

If you were pushed into GAP insurance, a warranty, or any other add-on — or you only later realised those extras were baked into your finance and costing you far more than you thought — it’s worth checking properly.

Start with Mis-Sold Finance Claims and, if you want someone to look at your situation, reach out via Contact Us. No win, no fee. No stress. Just results.