How to choose the right car insurance?

 

Choosing the correct car insurance can be a tough balancing act: we all want to save some money, but on the other hand we want to have the peace of mind of knowing that it will cover us adequately in the event of having to make a claim.

 

After all, not having insurance is not an option. Driving without it makes you liable for a fine or driving ban if you’re caught. So, what’s available? There are three types of insurance available to motorists. These are:

 

Third Party: This sort of insurance is the cheapest option and will cover your costs in the event of your driving injuring someone or damaging their property.

 

Third party plus fire and theft: This will offer the same protection as third party insurance, along with damages to your vehicle in the event of theft or fire.

 

Comprehensive insurance: The most expensive level of insurance: this will cover other drivers in the event of an accident, plus crucially, yourself.

 

 In the event of any claim, you will be liable to pay an ‘excess’.  This is a mandatory contribution towards the cost of repair or replacement. Each insurer also has various different sets of circumstances in which your insurance will be invalidated, so keep a close eye on what they are.

 

How do insurance companies calculate risk?

 

Put simply, insurance companies give cheaper premiums to drivers who they perceive to be less of a risk. There are a number of factors which are taken into account, ranging from the driver themselves to the car that’s being driven.

 

Cars are classified into 50 insurance groups by the Association of British Insurers, and most companies work to these guidelines. However, some insurers opt to use their own systems.

 

As a rule of thumb, cars which are faster and more expensive are classified in higher groups. Cheap, small cars with low power outputs are placed in low groups.

 

Meanwhile, drivers are judged on factors like age (drivers under 25 are statistically more likely to be involved in accidents) and their history on the roads. If a driver has a catalogue of mishaps and speeding convictions, then their insurance will cost more.

 

If you have a history of no accidents, then you will be liable for ‘no-claims’ status, which will grant you significant discounts on your insurance.

 

Other factors, like where you live are also taken into account.

 

How do I keep the cost of my insurance down?

 

There are a few simple measures you can take to keep the cost of your insurance down:

 

Stay safe: Keeping your foot off the accelerator and driving in a careful, considered fashion will keep you out of accidents and on the right side of the law. Importantly, having a clean driving history will make you far more attractive to insurers.

 

Invest in security: There’s a massive range of devices to boost the security of your car on the market: everything from steering wheel locks to super-hi tech alarms which issue warnings to would-be thieves. Insurers will acknowledge the effort you’ve made to minimise the risk of theft and reflect it in your premium.

 

Lock it up: If you have a garage, make sure you use it. When your car is locked up, it’s away from the prying eyes of thieves and out of harm’s way.

 

Agree to a fixed mileage: It’s not always workable, but agreeing to drive within a certain mileage limit will reduce your chances of being involved in an accident and make insurance cheaper.

 

Go annual: If it’s possible, pay for your insurance in a one-off sum. Spreading the payment usually incurs costs.

 

Shop around: Price comparison websites allow you to browse quotes from lots of insurance providers with a minimum of fuss. Many insurers will also reward you with a discount for buying online. But make sure you thoroughly compare the features of each policy to ensure it provides adequate cover should need it.