ALL THE FACTS ON ONE PAGE (car insurance)

What Is Car Insurance?

Car Insurance provides protection against losses incurred as a result of accidents, theft or damage to your vehicle. Motor insurance can be seen as a legal contract between you and your insurer, defining each party's rights and responsibilities in the case of an accident. As well as financial compensation, benefits of car insurance services can include alternative transport and breakdown assistance. Many of the questions concerning Car Insurance also apply to other forms of vehicle insurance, ie vans and motorcycles.

Do I Need Car Insurance?

Yes. It's the law. The UK Road Traffic Act legally binds all motorists to take out insurance against their liability for injuries to drivers and passengers and for damage to other's property. It is a serious criminal offence to drive your car or allow others to drive it without insurance which could land you in prison, especially if you are involved in an accident. The minimal legal requirement in the UK is Third Party insurance, this insures against loss and injury to others. Remember, driving without insurance is a big mistake.

What Are The Main Types Of Car Insurance?

There are three main types of car/motor insurance:

Third Party Only (TPO)

Protects individuals against liability should they injure a third party or cause damage to a third party's property. Most importantly, be aware that TPO does not cover the driver for damage, loss or theft to his or her car and property.

Third Party Fire and Theft (TPF&T)

Third Party coverage with additional coverage for theft of your vehicle and fire damage.

Comprehensive (Fully Comp)

Comprehensive cover can offer protection for accidental damage, theft, fire, as well as liability towards third parties. Importantly, Fully Comp can pay for damage to the driver's vehicle and property no matter whose fault the accident is.
Remember to always get quotes for comprehensive deals as well, even if you are considering Third Party options as the best likely outcome. Surprisingly, some insurers may offer a similar price for both third party and fully comp or even a cheaper fully comp offer.

This is a good website for more info on different types of insurance cover

http://car-insurance-info-4-u.blogspot.com/

Which Policy Should I Choose?

Assess your budget, the amount of miles you drive each year, distances you regularly travel, the value of your vehicle and then make a decision on what you need. Remember, the more the coverage the more you are likely to pay. Obviously, a full comp policy is the best option as long as you can afford it. Third Party F&T offers coverage for injuries to other people, including passengers, damage to other people's property and injury to passengers and coverage in the event of fire or theft to your vehicle. Fully Comp is also for injuries to other people, including passengers, damage to other people's property, accidental damage to your vehicle, medical expenses for your personal injury, loss of or damage to personal items in your car.

Is Age An Important Factor?

If you are young and driving an inexpensive first car then you will probably find the high cost of comprehensive motor insurance is prohibitive and does not make a lot of sense. If you are young with an expensive car then fully comp makes more sense, if you wish to safeguard the value of your expensive car. Many companies offer special deals on young driver car insurance. Older drivers with a clean record should find fully comprehensive deals increasingly affordable as time goes by.

What's A No Claims Bonus?

The No Claims Bonus or No Claims Discount is the traditional way of keeping car insurance premiums low. A history of zero claims demonstrates proof to the insurer that you are a lower risk. So they are happy to reduce the cost of your policy. Discounts vary depending upon the number of years of No Claims but it can be very significant. Some insurers will offer over 60 per cent discounts! Some insurers also offer small claims protection; meaning for a small fee you can protect your No Claims Bonus. This allows a limited number of claims to go through before any discount is affected.

What's A Write Off?

In the case of an accident, an insurance company can declare a vehicle totally destroyed ie a Write Off, also known as a 'right off' or 'totaled' vehicle. A Write Off verdict is made when a replacement vehicle would be cheaper to obtain than repairing the damaged one.

Do Students Get A Better Deal?

Traditionally students are seen as a high-risk group because of their age, lifestyle and also because students often live in areas associated with car crime. However, in the UK student car insurance premiums have become more competitive with plenty of companies targeting specialist young person or student car insurance deals. Shop around and look online for some of the best deals. You will probably find a better deal if you are still living with your parents rather than in digs or University halls of residence.

Are Older Drivers Safer?

Insurers think so. Motor Insurance for the Over 50s is generally seen as a low risk group by insurers so the premiums on offer are lower. However, this is mainly because the older driver often has a proven record of careful driving. There are now many UK companies offering specialist over 50s motor insurance so it is worth checking these out if you fall into the 50+ category as they can offer very good deals.

What Is Voluntary Excess?

There is always a minimum level of excess everyone has to pay but by requesting a higher level of voluntary excess you can reduce your car insurance costs by a fair margin. You can save money on your motor insurance premiums by opting for a higher voluntary excess on your motor insurance policy but be aware that a higher voluntary excess means you will have to pay out more in any eventual claim.

How Can I Save Money On Car Insurance And Get The Best Deal?

The big question. Prices fluctuate wildly so make sure you shop around and get as many quotes as you can, at least four or five. As well as comparing prices check carefully your policy and what is covered. Read Review Centre reviews which provide unbiased insights into the reliability of a wide range of insurance companies. Review Centre also provides links and information for a wide range of Car Insurers, including all the leading brands. In most cases you will save money by booking your insurance online.

What Other Ways Can I Reduce The Cost Of My Car Insurance Policy?

At the end of the day the lower the risk of theft, damage or injury then the lower your insurance costs will be. The following are ways which will reduce your insurance bill and keep your low claims bonus down.

Security

Ensure your vehicle is protected with the latest security equipment. Alarm systems, trackers and immobilisers will all reduce your bills. Find out from your insurer what car security products they will offer you reductions for if you install them.

Low Mileage

Work out your annual, monthly, weekly mileage as accurately as you can. If you drive low miles then tell your insurer as your premium will be lower. If you can reduce your mileage you will save money. Anything that lowers the risk of accident will reduce your premium.

Build A Garage

The use of a drive and/or a garage will reduce your insurance bill considerably as it is seen as a major deterrent to vandalism and theft. Garaging your car when not in use keeps down your insurance bill. Similarly, if you have a drive it is best to use it. The lower the risk, the lower the insurance cost.

Learn To Drive

Drive safely. Keep to speed limits, thereby reducing the risk of accidents as well as speeding fines which will push up your premium. The UK Institute of Advanced Motorists offers advanced motoring qualifications which will result in cheaper deals from insurers.

Change Your Address

Where you live affects your bill. The density of traffic and crime rates varies a lot from postcode to postcode and so affects your premium. Unfortunately, inner city postcodes tend to attract high premiums.

Multiple Cover

Most UK car insurers will also offer different insurance services such as home insurance and travel insurance. If you buy different policies from one insurer some firms will offer discounts on your bill. The right combined offer can be more convenient as well as saving you money.

Multiple Cars

Similar to multiple insurance contracts you may save money if you insure your multiple cars with the same company. You may find you will obtain better deals if you obtain single quotes for all your vehicles. If you have more than one car this is also convenient when it comes to paying your bill and obtaining information.

Don't Modify

Avoid modifying your car if you want to keep your premium low as it will normally lead to an increase in your insurance bill. Check with your insurer before going ahead or seek a specialist insurer to see what alternative deals are on offer. Likewise, if you are buying a kit car obtain advice in advance and consult a specialist insurer. Car clubs are also a good point of contact for advice.

What Are Insurance Groups?

Most cars have an insurance group ranking based on motor insurance industry data which determines the level of risk of each car on the market. High power and high value vehicles tend to be in the higher group - group 20; while small hatchbacks will be ranked low mainly due to their value for repair. When you buy a car factor in the insurance costs based on its Insurance Group.

Why Do The Costs Of Policies Vary So Much?

It's a competitive market. There are so many car insurers that they are all trying to tempt new customers from time to time so there are many great deals if you shop around. Insurers also make up their policies on a large number of criteria and personal info so much so that each insurer is bound to be different in terms of its calculations. There's also you - your age, where you live, your driving record and occupation all play a part statistically in whether you are likely to have an accident or not. There's also your vehicle - its engine size, make, model, its security features all of which affect the likelihood of an accident.

Where's The Small Print?

When you purchase Motor Insurance normally you receive two documents:

Certificate of Insurance

Your legal document which provides evidence of insurance.

Policy Document

This sets out in full the terms and conditions of your policy. Try and read it carefully as the interpretation of this will decide whether you receive help or not in the event of an accident.

What Info Do I Need To Provide When Obtaining A Quote?

• Make, model and year of manufacture
• Full address of where the vehicle is kept overnight including the postcode
• Details of any security alarm or immobilizer
• Mileage and the number of miles you travel each year
• Name, date of birth and occupation of driver(s)
• Drivers history including driving convictions, claims
• Dates of No Claims Bonus history
• Estimated value of your vehicle.