Choosing your level of car insurance

23/11/2009

Choosing your level of car insurance

A car insurance plan isn't something you can necessarily cut back on or avoid, unlike a gym membership or your regular food shopping bill. In order to drive a car on UK roads you need a policy in order to be legal. Driving in public without an insurance policy for the car you are in is a criminal offence - which means every driver has to go through the process of putting cover in place.

Thankfully this doesn't necessarily mean that you're going to end up paying over the odds. There are a number of different combinations and levels of protection from a wide variety of providers, which at least means the competition is reasonable and deals are available.

A specialist motoring website may sort you out with a policy within minutes, and may also be used to get a competitive quote. Normally you may be asked to choose between three common levels of car insurance;

•    third party only

•    third party fire and theft

•    fully comprehensive

Third party only is generally the cheapest form of protection. It only pays out for damage and injury to other people and their vehicles which results from your actions. So if you're involved in an accident which is your fault, you may only get a payout towards damage caused to someone else's vehicle, not your own.

Third party fire and theft does exactly the same thing as the first level of policy, but may pay out if your car is stolen or or damaged by a fire.

Finally fully comprehensive car cover is typically the most expensive form of cover and pays out for a variety of eventualities beyond the other two - it may cover you for scratches caused by vandalism, for example, and provides you with protection for the repair of damage done to your car after a crash.

So in general you pay more for the more detailed types of car insurance policy, and less for the more stripped-down versions. For example, third party only may in some circumstances be suitable for cars of a very low value, which are perhaps worth only a few hundred pounds.

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