Different Types of Car Insurance Explained

2008-10-07, Intune

Posted by paulcentric 56 days ago (1)
Category: Financial | Tags: insurance car travel pensioner

How do you get the best deal on your car insurance while ensuring that you are sufficiently well covered. Well to start with you need to shop around for the best car insurance quote; but how do you know which deal is right for you?
Well to start with you need to know how motor insurance works. The first thing you need to understand are the three main levels of car insurance cover available, this is where this article is able to help.

The three main types of cover available are “Third Party”, “Third Party, Fire & Theft” and “Fully Comprehensive”.
Third party cover is the most basic type of car insurance that you can take out. This covers the following liabilities; injuries to other people (including passengers), damage to other peoples property, accidents caused passengers and accidents caused by a caravan or trailer while attached to the car.
You may be wondering “What about damage to my own car?” Well third party doesn’t provide any cover for your own vehicle.

Third party cover is fine for those that cannot afford more comprehensive car insurance or those that drive an “old banger” where any repair work would cost more than the car is worth and which would cost only a few hundred pounds to replace.

However, if your car would cost more to replace, you will need to consider more comprehensive cover.

The next level of insurance cover is third party, fire and theft (also known as: TPFT). This provides the cover provided by third party plus damage to the policy holders car caused by fire or the theft of the vehicle. However, in the event of an accident that you have caused, TPFT will not pay for repairs to your car.

TPFT may be appropriate for those whose car is not worth very much, but that is worth more that the cost of excesses. It may particularly attractive to young drivers that find fully comprehensive cover costly, those who only drive once in a while or those that have little no-claims bonus.
However it is generally not suitable for people that drive on a regular basis or those with expensive cars.

The best form of car insurance cover is fully comprehensive (also known as: Fully Comp), this type of policy protects against the all the above plus the following. Accidental damage to your car, injury to your own person while in the car, medical expenses and loss of or damage to personal property in the car.

Please note however that not all “fully comp” insurance policies provides the same level of cover. Although all insurers will provide the cover stated above, many will offer additional extras, such as provision of courtesy cars in the event of theft, breakdown or accident, a protected no-claims bonuses or free insurance cover when driving in Europe.

If these extra are of benefit to you may find it is worth paying a little more for a policy that includes these features.

Intune
Providing financial services to the over 50’s.
Including car insurance, travel insurance and equity release products.