Commonly asked questions about car insurance
Organising insurance can be a complicated issue and naturally you may have a few questions you want answering before you continue with the policy! Try not to worry or stress out about these as the likelihood is that they are an easy solve and can have you on your way in no time! In this post, we will be looking at some of the most frequently asked questions about car insurance, as well as a few ways you can make arranging insurance a little bit easier.
What is an excess?
If it is your first-time organising car insurance, it is not uncommon to have never encountered the term ‘excess’.
In simple terms, an excess is the amount you agree to pay in the event of an accident. For example, if your car is damaged and you are found to be at fault, you will have to pay the amount of your excess towards repairs if you choose to make a claim. If the accident was the fault of the third party, you will be refunded the amount of your excess.
As a general rule, the higher your excess, the cheaper your overall premium. This is because an insurer will understand that you have more on the line if you were to be involved in an accident and would therefore be more careful when on the roads. If your excess is lower, the insurer will be liable to pay for more in damages and will therefore charge you a higher premium on an annual basis to make up for this.
You should only set your excess at a price you can afford or you may find yourself in a sticky situation if you have to make a claim and cannot pay the excess.
What is a No Claims Discount?
A No Claims Bonus or NCB is an accumulation of the years you have spent driving without making a claim. If you have been driving and buying insurance for 15 years and have no claim history, your NCB will be 15 years. This is a good indicator to the insurer that you are unlikely to make a claim and they will therefore offer you a lower premium.
A lack of NCB is part of the reason why insurance is always more expensive for young drivers. A high No Claims Discount shows experience and safe driving, something new drivers simply do not have under their belt. Safe driving and a clean record will help to reduce costs over time.
To read more about Young Driver’s Insurance, read this blog post.
Does my car affect the price of insurance?
Yes. Insurers work with car ‘groups’. The lower the group, usually the insurance is cheaper. Cars in lower insurance categories typically have a smaller engine, smaller body and less horsepower. This is because they are unlikely to cause as much damage in the event of an accident compared to a big, fast car.
Although it is not worth letting these groups dictate the car you buy, it is certainly a consideration when it comes to arranging insurance.
If you want to find out more about insurance groupings, head over to Money Super Market to find out more.
Why do I need to provide my personal details like address?
It is important that you provide your details to the insurer so that they can run checks on your area and decide what risk your car is at from being stolen or vandalised. This varies regionally and is consequently an important detail you must inform your insurer of.
If you move house, you may notice your insurance getting cheaper or even more expensive as a result of a change in area code.
It is also necessary for the insurer to know where the car is kept during the day and overnight, once again to determine the risk it is at. If your car is kept in a combination-locked garage 24/7, insurers will understand that it is not a great theft-risk.
Other personal details are important to determine experience and age. Your phone number and email address are taken to contact you easily about your policy.
Claims details and driving records are factors when insurers consider your premium. It is really important to declare everything to the person or system organising your insurance. If not, your policy could become invalid as insurers will run background checks and will find out anything you have not said.
What levels of cover are available to me?
As always, there are three different types of cover you can choose from when organising insurance.
The first is Comprehensive.
As the name suggests, it offers large coverage in the event you need to make a claim. This is the most ‘comprehensive’ type of insurance you can get. It will cover both you and the third party in an accident.
Secondly there is Third Party, fire and theft.
This policy will cover your car from fire or from theft. It will also cover the third party in an accident but unlike comprehensive, it will not cover your damages.
This is the lowest level of cover available in the UK and is a legal requirement. Your insurance will only cover damages to the third party. If you are at fault and you will have to cover your own expenses.
Can I drive someone else’s car under my insurance?
Not as a rule. If you are under 25, you will not be able to drive anyone else’s car, even with their permission. If you are older and the person adds you to their insurance, you may be able to drive their car. You will also have to let your insurer know that you are driving other people car. Being found driving an uninsured vehicle can result in up to 8 penalty points on your licence and this will immediately increase your premiums.
Do points on my licence effect my premium?
Yes, they will affect your premium. Penalty points show the insurer that you have been caught driving recklessly. Whether that be for speeding, drink driving, driving with a mobile phone or not stopping at a red light, it will increase you premium.
It may be worth taking a speed awareness course if it is offered to you. This will clear the three points you would have received for speeding.
If you fail to declare any driving convictions, you policy may become invalid. You will not be covered so it is important not to omit any details.
Are there any additional extras available?
With most insurers, you will be offered some add-ons to your policy. This may include key, legal or breakdown cover or excess protection.
These will add to the cost of your policy. However they may come in useful down the line so it is important to consider what you need.
If you have any questions, don’t hesitate to give us a call on 0333 222 4005.