7 questions to ask yourself before buying car insurance

car insurance questions

You should never, ever enter into or consider purchasing anything before doing the necessary homework first.

Seriously, you should leave absolutely nothing to chance in life, as it has a tendency to come back and bite you on the derriere if you fail to do your research. Question everything is our mantra. And then question some more for good measure.

Providing that the person you’re posing your questions too isn’t a politician, then there’s a very good chance your answer will be founded in some semblance of truth; which is of course the objective.

When it comes to the very important business of arranging (and subsequently exchanging money for) a car insurance policy then adopting an inquiring mind should be at the forefront of, well, your mind, as it’s no good complaining after the event that you hadn’t been aware of this clause or don’t understand that particular term or condition.

We understand that sometimes it’s all too easy just to go with a motor insurance provider that your parents/partner/friend plumps for, or perhaps opt for another company purely because you like their TV ads, and often without looking fully into the nitty gritty of what they offer. Or more importantly, what you need from a car insurance policy. But the thing is this: motorists can be quickly hoodwinked into buying a certain policy by a certain provider without really appreciating what they’re getting into, and what coverage they’re agreeing to in principle. And as per any business out there, car insurers offer a mind-boggling array of policies which can – and do – vary greatly from one provider to another, with regards to key issues such as coverage limitations and exclusions, the speed of the claims process, the availability to speak to a call centre operator and most pertinently, premium costs.

Which is why we’d always advocate the need to shop around once you’ve completed your homework, and know precisely what you want your individual car insurance package to afford you.

We simply can’t stress enough how vital it is to address your own specific car insurance requirements BEFORE you approach any motor insurance products, so you fully understand why you need insurance, what types are available to you, what each type covers and naturally, what decisions you need to make regarding policy excesses and NCDs.

Only once you’ve established the what, when, which, why and where will you become aware as to which motor insurance policy will serve your needs best. But just what are these questions you should be enquiring about/asking yourself from the outset?

Thankfully for you, this is precisely where we come in as usual, complete with our ‘7 Questions To Ask Before Buying Car Insurance’ guide which follows, which gives you the lowdown on the basics of motor insurance policies, and the information that you need to familiarise yourself with here and now.

Do I Actually Require Car Insurance?

Er, yes. Since the Road Traffic Act was passed back in 1988, it’s been against the law to drive a vehicle on public roads without the necessary motor insurance in place.

Besides which – as well as being totally unlawful as we now know – it would also be ludicrous not to safeguard your car, you and other road-users/their vehicles when out circumnavigating the highways and byways of Britain.

Essentially car insurance provides all-consuming and far-reaching financial peace of mind and due compensation for damage sustained by property (i.e, vehicles), drivers, passengers and pedestrians.

Car insurance

If I Didn’t Arrange Car Insurance, What Would Happen?

If for reasons which beggared belief a person flouted the law and chose not to purchase a motor insurance policy then they’d find themselves at serious risk of being slapped with a massive fine, receiving a whole heap of points on their driving license resulting in being banned from driving and ultimately, sent to prison; simply because as we pointed out above, it’s an offence to drive a car without one legitimate cover or another.

In terms of financial penalties, the maximum fine is £5,000, which is metered out with 6 – 8 points on a license, whilst any uninsured motorist who contravenes the 2006 Road Traffic Act (which includes those whose actions may have led to the serious injury/death of other road users) is liable to receive custodial sentencing in a court of law.

In addition to this sizeable deterrent, the police have the legal wherewithal to both seize and potentially destroy vehicles which are deemed to ignore legislation.

What If My Car Is Never Actually Used on The Road? Does This Make Me Exempt From Insurance?

In a word, yes. However if this is the case then it’s the registered owner’s responsibility to inform the DVLA of this situation and ensure they request a SORN (Statutory Off Road Notification) which officially accounts for the road tax status of the un-driven vehicle.

What Types of Car Insurance Are Available?

There are the 3 predominant types of motor insurance policy widely available in the UK, and which have been in circulation for many decades now. These are: Third Party, Third Party, Fire and Theft and Fully Comprehensive insurance.

Covering the driver and the vehicle to varying ends every motorist has to opt for one of these policies to comply with the law.

Third Party Only (TPO) is the entry-level motor insurance package if you like, and covers the driver and any third party (and their vehicle) if they are injured (damage sustained in the case of the vehicle) as a result of an accident. However it doesn’t extend to cover the policyholder’s vehicle should it require repairs.

Third Party, Fire and Theft (TPFT) offers the exact same level of coverage as TPO , yet also embraces the eventuality of the policyholder’s vehicle suffering damage indicative of a fire and/or it being subjected to theft.

Fully comprehensive is the all-encompassing car insurance option which provides repairs to/or replacement of the policyholder’s vehicle in the event of an accident, irrespective of culpability and can often incorporate extras such as legal cover and medical expenses.

Third party is historically the cheapest option, yet age and driving experience is a predominant factor behind even this type of motor insurance not always being competitively priced for some motorists.

What Uncontrollable Factors Influence How Much I Might Be Expected To Pay For Car Insurance?

The Million dollar question. Or rather, a few hundred pounds sterling as far as UK motorists are concerned.

There are a myriad of variables which motor insurance providers will take on board and mull over before they calculate exactly how much an individual will pay for their annual premiums, yet amongst the most obvious and sizeable core components used in working out just how much you’ll pay include; the type of vehicle you drive, the age and experience of the driver/proposer, where the proposer resides (postcode), what the vehicle will be used for (social, domestic, commuting, business purposes, etc…), the would-be policyholder’s claims history, where the vehicle is kept (both overnight and during the day) and details of any additional drivers you require adding to the policy.

What’s more, any previous driving convictions (fines and points accumulated) will be figured into any premium quote prepared.

Will An Excess Help Me To Reduce My Car Insurance Premiums?

Yes is the short answer to this question. There are two types of excess, compulsory (which is pre-defined by the insurance provider and a set rate) and voluntary, which is determined by the proposer/would-be policyholder/you when thrashing out a car insurance premium quote.

It’s universally accepted that if you increase your voluntary excess (in terms of the amount you’re willing to pay up-front should you be involved in an accident) then this calculated risk will be reflected in your annual premium, thus decreasing what it would be if you were to settle on a relatively low excess figure from the outset.

Although this has been found to not always be the case in recent years, while what a lot of motorists don’t realise is that increasing a voluntary excess will have nominal impact in minimising premiums for younger and inexperienced drivers, with more mature motorists not always benefitting as much as they first thought either.

Therefore you must always discuss amounts with your insurance provider from day one.

Will Having A No Claims Bonus/Discount (NCB/NCD) Help Reduce My Car Insurance Premium?

Every year that you don’t register a claim on your motor insurance policy you’ll receive a discount on the following year’s premium; in theory. This is colloquially referred to as either an NCB or an NCD within the motor insurance industry. And in addition to this you can affect a Protected No Claims Discount feature to any car insurance policy which hypothetically safeguards the NCD even if you claim in the intervening period/agreed term of insurance.

According to experts an NCD amounts to roughly 30% off a premium after 12 months of blemish-free driving, growing to 40% for sustaining 2 years. A maximum discount of this nature would amount to some 60 – 65%.

The protected no claims discount/bonus may be compromised should the policyholder experience two or more accidents/claims in the space of one year, plus neither will categorically shield the insured party from higher premiums based on other factors.

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