Understanding Car Insurance
Our easy-to-understand guide to the different levels of cover may help you buy an insurance premium that's better suited to your car... and your pocket!
It is important to understand that it is a legal requirement for all drivers to be adequately insured. Under the Road Traffic Act it is a criminal offence to drive your vehicle or allow others to drive it without sufficient cover for the car, and for you to give false statements or withhold information for the purposes of obtaining an insurance policy.
There are fundamental differences between the three main types of cover offered by most vehicle insurers - while most private motorists prefer to have the peace of mind that comes with any comprehensive car insurance policy, the bulk of the remainder tend to choose the third party, fire and theft option with a very small proportion taking out third party cover only.
What is Third Party Car Insurance?
Purchased by a first party (the insured) from a second party (the insurer) for protection against the claims of a third party (other drivers, passengers or people involved in an accident claim). This kind of insurance policy will normally cover liability for injuries and damage to other people and property but will not account for injuries or damage incurred by the first party. It can also protect against claims arising from accidents involving a caravan or trailer attached to the policy holder's vehicle.
How does Third Party, Fire and Theft cover differ?
In addition to the basic Third Party level of cover, this enhanced policy means that a vehicle will also be insured against theft and either loss or damage caused by fire.
Is Comprehensive Insurance the best cover for any car?
Not necessarily, but it is designed to cover all bases and is therefore the kind of policy that's guaranteed to provide total peace of mind for any car owner and driver, which unfortunately comes at higher cost. This premium level of cover includes third party, fire and theft plus damage to your own vehicle, loss or damage to personal effects in the vehicle, personal accident, death and disability benefit, medical expenses cover and windscreen replacement. Some car insurers allow the policyholder to drive other cars but this can only happen with the owner's permission and the vehicle cover will be limited to third party only.
It is important to remember to read any car insurance policy thoroughly and check with individual insurers as there may be high excesses levied (i.e. the amount you are liable to pay in the event of a claim), and other conditions attached. All car insurance policies require your vehicle to be in a roadworthy condition and you must inform your insurers of any changes in your personal circumstances during the lifetime of the policy, such as address, occupation, type of vehicle, medical conditions and motoring convictions.
Once you have purchased and received your certicate of insurance, along with all the other important and informational elements that accompany any legal policy document, then you will have evidence that you have sufficient cover for driving on Britain's public roads as required by the Road Traffic Act. As previously stated, it is vital that these documents are read very carefully as they set out the terms and conditions of your individual policy at whatever level of cover you have opted to buy.
