Should you ever have an accident, your car insurance is there to give you a degree of financial protection. It is a mandatory and necessary expense if you own or drive a motor vehicle. A car insurance policy will provide you with much needed protection against financial losses incurred because of traffic accidents.

Not all insurance policies cover you against damage to your own vehicle, or liability for property damage or legal fees. Bolt-on niche insurance products such as inconvenience cover, gap insurance and even legal protection insurance can prove to be invaluable additions to your comprehensive car insurance to ensure an accident does not end up costing you more than you can afford should the worst happen.

Choosing the right car insurance product will protect you, your vehicle, and other parties in the long run. You must prove that you have bought car insurance if you plan to drive in the UK. Your level of protection will depend on the type of car insurance policy you choose to take out.

WHY YOU SHOULD SHOP AROUND FOR NEW CAR INSURANCE

Shopping around for car insurance is very important for several reasons:

• You may find better quotes
• Depreciation will affect the value of your car
• Your personal circumstances may be different
• Your car finance may put your car at risk
• You could find a policy which includes cover for loss of personal items
• Breakdown cover may be included in some policies
• You could find a policy which includes legal cover
• You could find a policy which includes cover for a second car
• You may be offered an introductory discount

Just because you have used the same insurance company or insurance broker for several years, does not mean you are getting the best deal. All it really means is that you have used the same insurance company or insurance broker for the past several years.

A good insurance broker is most likely to get you the best coverage if they manage your full insurance portfolio as they then know your history and needs. This is also the case with car insurance as they can often consolidate your insurance needs into an all inclusive package which most insurance companies only make available to brokers.

Car depreciation occurs as a result of the age and usage of a vehicle. No sooner than you have driven your new car off the showroom floor the car begins to depreciate. For every year that you own a car it will decrease in value. You should therefore insure accordingly by adjusting your car’s declared value at renewal time. This is logical but often people can overlook the obvious. So always ask your broker to check the value of your car against its blue book value, rather than the purchase price. The reason is that even fully comprehensive car insurance policies do not cover a vehicle to the purchase price, but rather the blue book value. Ensure you declare the vehicle’s value accurately. If you have bought an expensive car, then the chances are that it will cost you more to insure. In rare cases the insurance company may offer a replacement car of the exact model or spec after an accident. There is however an insurance product called Vehicle Replacement Insurance which does just that! Finding out more about vehicle replacement insurance is easy, just click on the link.

Your car insurance could be affected if your circumstances have changed since your last renewal. You may have switched jobs and not drive as many miles per year or have paved the front lawn and turned it into off-street parking. Get insured according to any changes in circumstances – no matter how small you think they are. Insurance companies lower their prices for low mileage drivers and discounts can be significantAdding additional drivers is not as expensive as you would think; a great tip here is to wait until renewal time if possible. Insurers may charge you an administration cost for adding additional drivers, but if you wait until it’s time to renew you may not incur this fee.

SO WHICH IS THE BEST CHOICE OF CAR INSURANCE COVER?

Insurance cover in the UK falls into three different categories.

1. Basic Third Party Insurance is mandatory in many countries, including the UK. This type of cover insures a vehicle and driver against damage to another person’s car, driver or passengers if involved in an accident. This type of insurance covers your liabilities in the event of damage to another vehicle or person in an accident. The insured is not protected against bodily injury or damage to their own vehicle with this type of policy. Third party insurance will not cover any necessary repairs made to your car.
2. Third Party, Fire and Theft Insurance will cover the benefits of third party insurance and includes any financial loss to the insured vehicle caused by fire or theft. This type of cover can offer the best value for a policyholder if the car does not have a high market value. A car which has been either leased or financed must have a fully comprehensive insurance policy.
3. “Fully Comp” will give you the widest insurance cover for your vehicle.Damage to your car, and personal injury caused by an accident, as well as the basics of third party, fire and theft, are covered by a comprehensive car insurance policy. If your car is worth more than you could afford to replace it, then you should opt for a fully comprehensive insurance policy. Finance Gap or Vehicle Replacement Gap Insurance are additional insurance products available to top up the gap between your payout and the cost of paying off a new car, so go online and find out more about these insurance products.
Many factors affect car insurance and most insurance companies offer a range of secondary covers to meet the varied and specialized needs of the policyholder.

FACTORS AFFECTING CAR INSURANCE

1. The Policyholder

• Age of the policyholder
• Whether you are male or female
• Are you married or single
• As a policy holder your address affects your premium
• How large the car and engine are
• How much your car will cost to replace
• Any modifications that have been made to the vehicle by its owner

A younger less experienced driver will pay a higher insurance premium than someone with several years driving experience.

A married person is considered more responsible for their actions than a person is with no commitments. It stands to reason that a married man with children has more responsibilities and the insurance companies will therefore consider this person a lower risk than a single male in his early twenties driving a WRX.

Where a person lives also affects the insurance cost. If you live in the country or in a low crime rate location you are likely to get a lower premium than if you are a city-dweller.

A powerful car is more likely to lose control at the hands of younger drivers: expensive cars cost a lot to replace if scrapped and should they simply require repairs the sum of the replacement parts often costs more than the used car’s value, making more powerful cars very expensive to ensure.

Modifications are more likely to alter the vehicles safety; performance is improved, and handling may be compromised making the vehicle more unpredictable. The insurance company therefore sees these factors as an increased risk and will increase their premiums as a result.

2. Driver History

• Years of driving experience
• Historical claims
• History of driving convictions
• Annual mileage

The number of years a person has been driving suggests their understanding of the rules of the road, shows the driver has built up experience of driving under varied driving conditions and has attained a certain level of confidence while behind the wheel. The number of insurance claims made in the previous five years will either confirm or deny these assumptions. Most driving convictions negatively affect motor insurance premiums for drivers. Parking offenses do not push up your premiums unless you incurred points.

Annual mileage is a factor too. The risk of having an accident increases the longer a vehicle is on the road.

3. Vehicle History

• Current vehicle value
• Owned, leased or financed
• Make and model of the vehicle
• Engine size and performance
• Modifications to the vehicle

If the vehicle has a low book value, it may not seem to be cost effective to pay for comprehensive insurance; however this is not necessarily the case. If the named driver has several years no claims then fully comprehensive insurance could actually cost the same as third party fire and theft cover, but with additional perks such as windscreen cover and legal assistance etc. Many on-line insurance buyers find that for just a small premium increase, many additional benefits can be included. If you are leasing a vehicle or have acquired it via a finance company, then you will need to provide fully comprehensive insurance for the vehicle. This is so that they can be reimbursed for any damage caused to the car by the policyholder. Comprehensive insurance will cover this.

There may be other benefits included in your car insurance policy, which are not always necessary but sometimes advisable:

• Breakdown insurance
• A courtesy car could be offered while yours is being repaired
• Roadside or breakdown cover
• Some insurers may offer you legal cover included in your policy
• Windscreen replacement
• No Claims protection
• Compulsory or voluntary deductible amount

Choosing the correct insurance and getting the best quote can be daunting as there are so many variables to consider. If a website was built properly its users will find it easy to get a great price quickly and easily. Consider using an insurance aggregator website for your initial quotes. The average insurance buyer finds aggregator websites easy to use. They will search the insurance market for you and show you the products which best match you needs based on the answers to some initial questions. After the site has collected the quotes, you can then compare different policies, as well as being able to save your quote, amend your requirements if necessary and if you are happy you can then buy on-line. Before you commit to a purchase it’s a good idea to first tell your broker the results of your search to see if he can get you a better deal. Remember that you need to compare quotes on a like-for-like basis. It is not always a quick and easy task. Good luck on finding your ideal car insurance.

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