Car insurance is something that we need to purchase to stay inside the law and to protect the valuable asset that is our vehicle. We can simply insure our car to protect others on the road from the financial burden our driving could potentially cause them, or we can go a step further and also look to buy insurance that covers the vehicle we drive against fire and theft and the accidental damage we may cause it.
In the meantime, let us proceed to what we should know about car insurance so that we end up with the level of protection we are seeking.
Different Types of Cover
The most basic form of cover with motor insurance is to have Third Party Only. This simply means that if you do damage to another person’s vehicle and/or injure them, then they can claim compensation from your insurance company. It is the least cover you can have and is required by law in the UK, and just about every other country in the world.
For those who are in an area of high crime, it is a good idea to extend the above cover and also insure against fire and theft. This is peace of mind when perhaps you are unable to park your car inside a garage at night. However, this may help lower your insurance premium if you do.
Comprehensive cover is like having accidental damage covered on a household policy and will cover for damage you cause to your vehicle that is your fault. You may think that you are a good driver but accidents can happen due to distraction or weather conditions where nobody else was involved but yourself to claim off.
So, consider the motor insurance coverage you need carefully. With a newer more valuable vehicle, you should be persuaded towards purchasing a Comprehensive car insurance policy. This will provide the ultimate protection. Also, this type of policy will be required when you are purchasing a vehicle on a finance agreement so that everyone is protected financially.
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If you are looking for your insurer to pay the whole of your claim in the event of a motor accident, then you should think again because every policy will have some kind of excess attached to it. This is the part of the claim that you will pay for. The good news is, the higher the excess, the lower the premium you will likely end up paying. This is where voluntary excesses can help reduce costs where there are young drivers, who themselves will often attract a higher compulsory excess.
A typical compulsory excess on a comprehensive policy might be £100 and then a further £100 that can be voluntary. It should be noted that the usual excess for fire and theft claims is £100. It is still a lot less than withstanding the whole of a claim, which would create a significant financial burden.
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The extras on an insurance policy will include having some windscreen cover, which is only generally provided with a comprehensive insurance policy. It will carry a lower excess than when damage is caused to the body of a vehicle in an accident.
It is the use to cover to have because it only takes one loose chipping on a motorway journey to crack your windscreen. You can fail the MOT for this, depending on where the crack is and how big. The MOT rules in the UK are currently that a crack of 10mm or bigger in the A-Zone (a 290mm area directly in front of a driver) will be enough to fail.
A crack of 40mm or bigger anywhere else will also result in a failure. So, these cracks will need repairing and can be costly without insurance, depending on your make and model of car.
If you are looking for breakdown cover, this will be extra to pay for on a policy. It is generally only applicable in the event of an accident, though, so may not provide cover unless there has been a collision. Whereas a separate breakdown cover from another provider may also cover you for breakdowns not relating to accidents, including if you cannot start your car on the driveway one morning. Be careful not to duplicate breakdown cover and end up paying for the same cover twice with two different providers.
Legal assistance is another extra that policyholders might want to consider. Should there be a dispute about whose fault an accident was, it can mean the difference between keeping no claims bonus, and the discount it gives, or losing no claims bonus and making the policy dearer the following year. It is worth fighting for in instances of 50/50. But then, you could always opt to have a protected no claims bonus for an extra premium. It will allow you to have an agreed number of “at fault” accidents without your bonus being affected.
To summarise, to be covered with car insurance to the extent that we expect, we need to know about the difference between a Third Party and Comprehensive insurance cover. Also, have an awareness that we will need to pay the first part of any claim. It is not exactly in the small print, instead made clear, but not everyone gives it the thought it deserves. Finally, think about what else you can be covered for, such as windscreen cover, breakdown cover, and legal assistance. It depends on the value of your car and your budget on how far you insure it. However, this is okay as long as you know what you are missing out on by accepting less cover in exchange for a lower premium.