Policy basics

Why is car insurance important?

In 1930, it became a legal requirement in the UK for every person using a vehicle on the road to have an insurance policy. Buying car insurance is not only necessary by law, but it is also important that you can pay for any damages caused by an accident.

Should you have an accident, your car insurance policy will cover anything from damage to other vehicles and drivers to damage to yourself and your car. Every insurance policy is different, some are cheaper than others and their prices change depending on your personal circumstances such as age, gender and experience. Our Car Insurance Guide will help you find the policy to suit you.

Policy Basics

When looking for car insurance, it is important to understand the different types of policies available, and their limitations. Some policies will insure for more eventualities than others, and you need to make sure that you choose the correct policy without paying too much. Your car insurance policy should be based on your experience, driving style, age and affordability.

It is a legal requirement to insure your car with at least a third party insurance cover. This is the lowest policy available and covers damage to a third party in the event of an accident that is your fault:

  • If you are in an accident concerning a third party, this policy will cover damages to that car and any injured occupants.
  • The policy will only pay for:
    • Damage to the other persons vehicle
    • Medical claims or injuries suffered by the occupants of the other car
    • Medical claims or injuries suffered by the passengers in your car other than you

The policy will not pay for:

  • Damage to your own vehicle
  • Your medical expenses
  • Theft or repair of your vehicle if it is stolen or set on fire.

Other Policies

As well as third party insurance cover, the other main insurance policies are:

  • Third party fire and theft – This covers the cost of damages to a third party’s vehicle and injury to any people involved, other than you. It also covers the cost of damage to your vehicle if it is stolen or set on fire.
  • Comprehensive – Also known as fully comprehensive. This policy covers the cost of all damages and injuries for you and the third party, regardless of whose fault the accident was. It will also cover the cost of any damages to your vehicle in the event of theft or fire.

Specialist insurance policies are also available, and you may be able to get a discount on the price you pay for your insurance based on your circumstances.

  • Classic car insurance – Specialist policies for classic and vintage cars.
  • Motorcycle insurance – Insurance policies especially for motorbikes.
  • Commercial vehicle insurance – Insurance policies for company owned vehicles.
  • Senior car insurance – Insurance policies for people aged over 50 years.
  • Women only car insurance – Insurance policies for women only.
  • Young drivers car insurance – Insurance policies for young drivers, usually those younger than 25 years of age.
  • Student car insurance – Insurance policies for student drivers.