Whether they like it or not, all motorists require car insurance. It has been a legal requirement since the introduction of the Road Traffic Act in 1930 and the penalties if driving without car insurance can be extremely costly. They were introduced to protect motorists and cover you for your liability against other drivers. The cost of car insurance is forever rising, with an 11% increase in premium costs in 2017 alone. The average amount spent on car insurance in the UK in the first half of 2017 was £484, with younger and older drivers often paying even more. This is why it is important to shop around and find out which policy is going to work for you. Also, take into consideration other aspects that can increase your premiums, for example, the value of your car, your driving history and the security of your vehicle. But what do all the different car insurance policies mean? Worry not, we’ve put a quick guide together to help explain the three main types of car insurance policy.
This is the most basic cover of the bunch and the minimum legal requirement. If you are in an accident that was your fault, third party policies will cover the expenses of other drivers or pedestrians who make a claim against them. It will cover the damage to their car and any injuries they or their passengers incur during the collision, as well as property damage and injuries to animals. Essentially, it covers any expenses that aren’t linked to you; any damage to your own car needs to come out of your own pocket. If your car is stolen, this too will have to come out of your pocket.
This policy covers everything that third party policies cover, but also fire and theft. Any fire damage to your own vehicle will be compensated for. If your car has been stolen, or any damage from an attempt to steal it, for example, a broken window will also be compensated for. Any other damage your car sustains in an accident where you are at fault will have to come out of your own pocket. These first two policies would not be recommended if you own an expensive car. The cost to cover expenses if you are in a collision would be very high; the more expensive the car, the more expensive it is to fix. If you own a cheaper car and aren’t too concerned if it gets damaged, then these two policies could be a good way to save money.
Fully comprehensive car insurance covers all of the above and more. If you are at fault in an incident the ‘fully comp’ policy covers damages to the innocent driver’s car and their injuries and any damages sustained to your vehicle and any injuries you suffered too, as well as fire damage and theft compensation. It is often called ‘fully comp’ as this is what it appears to be when compared to the other policies, however, this can be a little misleading. The comprehensive cover may sound like the best one to choose, and therefore the most expensive, but this isn’t necessarily the case. Sometimes, it comes down to supply and demand. If a lot of people opt for the third party only cover, thinking it will be the cheapest, then the price for it can go up. It’s always worth checking all three to see which one works best for you. It can also be misleading to think that the comprehensive cover will protect you from every possible eventuality. All the added extra protection, like breakdown cover, is only supplied by some insurers and others add an extra fee if you want this included. Read through each policy and check everything it covers before purchasing. It is also worth noting, that you could use this cover to claim compensation for any damage that occurred that doesn't involve another driver, for example, damage caused by a pothole. Compare insurers as well as policies and find the best car insurance premium for you.