Buying car insurance for the first time can be quite a daunting task, questions such as " What type of cover will I need? How much will it cost? Who should I insure with?" are often asked by people new to buying car insurance. Basically, there are three types of insurance:
This is the lowest level of cover. It insures against damage and injuries that you, or your passenger, cause to another person or their property in an accident. It doesn't pay for any damage or injury to you or your car. This is the minimum legal requirement.
Third party, fire and theft
This is like third party cover but it will also pay to repair or replace your car if it's stolen or if it's damaged or destroyed by fire.
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.
Even if you're thinking about third party, fire and theft, it's also worth getting quotes for comprehensive cover. The former will always be cheaper, but you may find that comprehensive cover doesn't cost that much more considering the extra protection you're getting.
The no-claims discount (NCD) is one of the most important features of your car insurance policy.The amount of NCD you can expect varies widely between insurers. One year's claim-free motoring could give you a discount of as much as 57.5%, or as little as 27%, depending on which company you're with.Typically, you can reach a maximum NCD of 60% to 70% if you have four years of claim-free motoring. Some insurers offer a higher maximum NCD for older drivers.
Claiming on your insurance will invalidate any NCD you have built up.
Your NCD will be cut if you make a claim, but the size of the cut varies between insurers, too. In the best cases, the maximum NCD would be reduced by just 3%, from 75 to 72. But if you're under 50, you could see your maximum NCD cut by as much as 22%.
You can limit the impact of a claim on your NCD by paying extra for NCD protection. You'll typically have to pay 10% to 15% to protect your NCD - and it is usually available only after four years with the same insurer. However this protection can make a huge difference to the premiums you pay for your car insurance.
If you protect your NCD, making one claim in a year will have no effect. Making two claims in a year won't affect your NCD with some companies, but with others your NCD could be reduced to as little as 45% if you make two claims in the same year.
A wide range of factors are taken into account in calculating car insurance premiums. It can depend on - the type of car you drive, where it's kept, the driver, the drivers age, where you live, whether it's for business and / or leisure... so take your time and shop around to get the best deal!