Do I need car insurance?
Yes – car insurance is a legal requirement if you own or use a car, unless you declare it off the road with a SORN (Statutory Off Road Notification).
If you’re caught driving without insurance, you could face a £300 fine and 6 penalty points on your licence. But if the case ends up in court, you could face an unlimited fine. As well as a fine and points, your car risks being impounded or even destroyed. This in turn could make your future car insurance quotes more expensive.
What are the 3 levels of car insurance?
There are 3 main options to choose from when buying car insurance. The lowest level of cover isn’t always the cheapest, so opting for a higher level of cover, such as comprehensive insurance might give you more protection for a cheaper price.
Third-party car insurance is the lowest level of cover available and the minimum legal level of cover required to drive. It covers you if you damage someone else’s property or injure them while driving, and covers your passengers too.
Third-party fire & theft insures you against damage you might cause to someone else, their car or their property, including your passengers. It doesn’t include cover for damage to your own car but does cover repair or replacement of it if it’s stolen or damaged by fire.
Comprehensive car insurance also known as ‘fully comp’ gives you the most protection, covering you and your car as well as other people and their property.
How are car insurance quotes calculated?
There’s a lot that goes into how much you pay for your car insurance. Insurance companies use various factors to decide how likely you are to make a claim, which is reflected in your price.
Some of the bigger factors are:
Where you live
Your age
The car you own
What you do for a living
Your driving history
Your annual mileage
How secure your car is
Your voluntary excess
Who else drives your car
Where you live will affect your car insurance price. If you live in a built-up area with more vehicle crime you’ll likely be paying more than someone living in a rural area where the risks are lower.
Your age and driving experience are significant to insurers. Generally, the younger you are, the less driving experience you have. In insurers’ eyes this means you’re more likely to have an accident and make a claim.
The car you drive has one of the largest effects on your insurance costs. Bigger, high-performance and expensive models, as well as cars with modifications, usually cost insurers more to repair after an accident. Desirable and valuable cars are also more often a target for opportunistic thieves.
What you do for a living is important as it gives an indication to insurers of how much time you spend on the road. Long days behind the wheel or travelling to multiple sites a day might increase your risk of making a claim.
Your driving history including previous claims or accidents help give insurance companies an idea of how you drive. If you’ve made a claim in the past 5 years, this will affect the cost of your insurance. Driving convictions also contribute to the amount you pay.
Your annual mileage tells insurers how much you’re on the road. The more miles you rack up, the greater the risk of an accident.
How secure your car is can have a sizable impact on your policy. Cars fitted with an alarm, immobiliser and tracker are harder to steal and easier to recover. Good security measures could help keep your costs down.
Your voluntary excess is the amount of money you pay towards a car insurance claim. The higher this excess, the lower the price tends to be.
Who else drives your car is important as it’s an additional risk. Depending on the named drivers’ age, experience and claims history, your costs can go up or down.