What are the Types of Car Insurance?

Car insurance is an absolutely essential purchase for any driver. But there are several different types of insurance for which you can obtain a policy, with varying advantages and disadvantages. It is a really great idea to review each type before you choose your coverage, so that you can be sure that you have the best policy for your own individual circumstances.

Policy Types

The cheapest type of insurance on the market is third party cover. It is also the minimum type of coverage required by law in the UK. If you need a budget insurance policy, this kind of cover will probably suit you. However, it is limited in its applicability, which is why it is cheaper than the other kinds of car insurance. It may not cover you in all situations you may find yourself in.

Third party cover simply provides you with protection against liability for damage to other people or their property. If you are at fault in an accident, the other person can make a claim on your insurance so you will not have to pay for their damages directly out of your own pocket. However, third party does not cover damage to your own car, nor does it cover theft of your car, or repairs.

The second type of car insurance policy is third party fire and theft. This is slightly more expensive than simple third party, but in addition to covering you for third person liability, this policy also protects you if your car is damaged by fire or if it is stolen by thieves. Therefore, it offers you a bit more protection. However, it does not cover you if your car is broken into and the contents stolen, or if your car requires repairs after an accident.

The third, and most expensive, type of policy is fully comprehensive cover. This is the most coverage you can get for your car without taking up some of the available optional extras. Fully comprehensive cover protects you against third person liability, theft of your car, damage to your car and repairs to other vehicles which you have damaged. Depending on your insurance provider, fully comprehensive cover may offer a range of other features.

For example, some insurers may include cover for the valuables inside your car as well. So, if your car is broken into and your stereo is stolen, you can make a claim on your insurance. A courtesy car is often provided as an extra on some policies, so that if your car is sadly written off in an accident, you will be provided with a means of transportation until you get another car.

Breakdown cover is another optional extra that you can take advantage off for a small increase on your fully comprehensive premium. This might be particularly useful if you often travel on isolated roads where you may one day end up stranded. Breakdown cover will give you great peace of mind and protect you against that eventuality.

In summary, there are three types of car insurance which you can take out to cover your car. It is an absolute legal requirement to have some form of insurance on the road. However, depending on the probability of your car being stolen or broken into, or breaking down while you are travelling, it may not work out as cost effective as it appears to buy the cheapest type of insurance. You may be better off investing in more expensive cover which might protect you better and thus save you money in the long term.

" This site taught me a lot about shopping for my first insurance policy, and helped make it easy to get some quotes too. "

Oliver D
Wales UK