Car Insurance

Types of car insurance policies

There are three main types of car insurance policies:

• Third party car insurance: This is the lowest level of insurance cover required by law. If involved in an accident these policies cover the cost of repairs or replacing the other individual’s car. It however, does not cover the damage done to the insured individual’s car, but if it is the other drivers fault; drivers can claim against their insurance.
• Third party, fire and theft car insurance: This insurance is almost similar to the third party, the only difference is that this policy will provide cover to the drivers’ car if their car is damaged in a fire or is stolen.
• Comprehensive car insurance: This is also known as fully comprehensive insurance. This is the highest level of cover; the driver will be insured against injuries to others, theft of car, and damage to other people’s property, accidental damage to their own car, fire damage and personal belongings. This insurance effectively covers individuals regardless of fault.

Requirements needed to apply for car insurance?

Insurance companies consider a range of factors so they can calculate the correct car insurance premiums, for instance;

• The type of car
• Where the car will be kept
• The age and experience of the driver
• Where the individual lives
• The no claims history
• Details of any additional drivers
• The use of the car

Sometimes driving offences can also play a part on the insurance cost. The more severe the offence the more expensive the insurance will be. What is a no-claims bonus or discount? For each year an individual who has car insurance doesn’t make a claim, they accrue ‘no claims’ which enable them to access a ‘no claims’ discount on the following year’s premium For insurers this is evidence that as a driver is less of a risk , so cover is cheaper.

Can I take my no-claims discounts if I decide to change insurers?

Normally individuals can take their car insurance no claims discount with them when they switch insurers, so long as they can evidence it. The discount might not be the same, but the new company should honour your claims history. No claims discount can be transferred to another vehicle, for example if a new car is acquired during the life of the policy.

What is an excess?

An excess is a sum of money the insurance company requires an individual to pay towards the cost of making a claim. There are two types of excess insurance claims:

• The compulsory excess: This is non-negotiable and depends for instance, on your age or type of car
• The voluntary excess: This as the name suggests and can be set by the individual buying the insurance. They can decide on the amount or whether they want it or not