Gap insurance is not something which a traveller might take out during their pre-university year abroad but a form of motor insurance that could cause car owners to find themselves stuck if without.

This kind of policy is intended to bridge the gap between the original market value of a car and what the insurer is prepared to pay out in the event of the motor being written off or stolen.

Monies paid out by gap insurance policies can then be used to clear outstanding debts that may be lingering from the original purchase or to finance a replacement vehicle.

Gap insurance is particularly good for motorists who use their car in a way that would lead it to depreciate in value quickly.

Doing a lot of miles, for instance, may result in the car's value falling swiftly, which in the event of an accident could see the motorist severely short changed in comparison with how much they paid.

According to insurance firm the AA, the average car has lost around 40 per cent of its value by the end of its first year of ownership.

Furthermore, if a motorist were to do 10,000 miles a year the average car would have lost around 60 per cent of its value after three years of ownership.

The insurance firm goes as far to say that buying a five-year-old car may be a better option as although motorists won't always get the most up-to-date features the vehicle will not depreciate so rapidly.

However, for those who appreciate having a nice car buying an old wreck that doesn't have much value to lose may not be the most appealing option.

This is where gap insurance can prove handy, as although it will not protect drivers against achieving a bad sale price when they decide to trade the vehicle in, it does provide cover in the event of an accident.

Tom White, of motoring magazine Auto Trader, says that although not all drivers should take out gap insurance – those with cars aged over seven years old will not be offered it – it is a good option for some motorists.

He explained: "The newer and higher value of the vehicle, the greater the depreciation will potentially be and therefore gap [insurance] will have greater relevance."

Mr White also advocates using "some element of price comparison" before purchasing this kind of policy as there are a number of different products on the market, each with their own benefits.

However, he dispelled claims that the presence of gap insurance could alleviate insurers of their responsibility to pay out policy holders for the true amount their vehicle is worth.

"My view is that this will not affect motor insurance payouts – these are typically based upon agreed market values from industry statistics," he said.

However, according to insurance provider Click4Gap.co.uk, gap insurance is a "little-known product" amongst new car drivers.

Marketing director of the firm, Andy Bendell, added that the price of this kind of cover is determined by different factors to a normal insurance policy.

He explained that unlike comprehensive cover, gap insurance premiums are not dependent on variables such as age, the number of points on a driver's licence or their address.

Furthermore, according to autocheck.co.uk, insurance firms currently write off 500,000 cars per year, highlighting the need for gap insurance.