Car Insurance Buyer’s Guide

Buyers Guide-car insurance

It can be confusing searching the market for car insurance especially when not all insurance companies can give you the best price or the right policy for your needs.  Car insurance choices is here to help you with that decision without having to pick up the phone our search through lots of different sites.  Here are a few tips to make things easy.

Things to know before you apply

Different insurers ask for different things when you request an insurance quote.  The information you give them is used to assess your risk and provide a price.  Getting the information wrong on a policy that you take out can be a simple inconvenience or can have more serious consequences in the event of a claim.  That’s why it’s important to have some accurate information handy before you start applying for quotes and helps to ensure that you can correctly compare prices and policy options.  Useful documents to have to hand are:

• If you already own the car/have an existing policy that’s due for renewal:
• The Vehicle Registration Document (Known as the V5)
• Your driving licence AND paper counterpart for photo card licence holders

If you know the car you are about to purchase
If you know the car you are about to purchase

• A copy of the registration number (number plate) along with the make, model, colour and engine size
• Your driving licence AND paper counterpart for photo card licence holders

What affects the price I pay?

There are 100s of different insurers that can provide insurance for your vehicle. However, insurance companies prefer to pick and choose the type of customers that they accept onto their books. Your circumstances make a big difference to the price that you are offered; if those circumstances are considered favourable by the insurer then this will have a positive impact on the price. If however your circumstances do not suit the “risk portfolio” of your chosen insurer, this can lead to more expensive quotes, or no offer of cover being made at all. If you need help deciding on which insurer might be best for your circumstances, visit our top insurance table for more information

Your personal circumstances

Car insurance companies are not it seems, influenced by political correctness so whether you are male or female will typically affect the price you pay! Women are considered by many insurers to be a lower risk so typically pay lower premiums.
Your age and length of licence make a big difference. Young and newly-licensed drivers always pay more so it can be worthwhile looking for an insurer that specialises in this for a better price. More experienced drivers will usually benefit from lower premiums depending on their driving history. Insurance companies typically favour drivers with a valid no-claims bonus of several years at the point of application.

Your driving history is important to your quote. Having any penalty points (endorsements), previous driving convictions, driving disqualifications or any history of vehicle accidents that resulted in claims will start to bump up insurance premiums significantly and restrict the number of insurers that are prepared to accept your business. In most cases there is still a choice of insurers that can provide you with a policy.

It’s worth remembering that making a false declaration to an insurer about your driving history can be very serious. It’s better to pay the extra premium than risk making your policy void in the event of a claim.

Where you live and where the car will be most often kept (e.g. in a locked garage, on a drive, on the street etc.) counts in the policy calculation. Your postcode and house number provide insurance companies with an amount to factor into your policy regarding the safety of the neighbourhood that you live in.

Your car, its value and the level of cover you should take

There are 3 main types of insurance available to vehicles that are to be insured in the UK:

• Third-Party;
• Third-Party, Fire & Theft; and
• Comprehensive, also known as “fully-comprehensive”

Typically cars of £1,000 or less in value are best suited to third-party cover, as a single year of insurance cover can be of greater value than the car being insured. It does mean that in the event of any claim, other parties are protected but that you bear the cost of your own repairs if it is considered to be your fault. Third Party represents the cheapest way to be road-legal, but in the event of a claim can leave you out of pocket particularly if the cost of repairs are high or the vehicle is written-off (i.e. cannot be repaired), or is stolen or damaged through fire.

For a slightly higher premium, Third-Party Cover can be extended to include insurance against Fire and Theft. Repairs to your vehicle are still excluded from your policy in the circumstances explained above, but your loss through fire or theft is protected and your insurance company will pay out in the event of a valid claim.

Drivers with cars in excess of £1,000 in value should consider comprehensive insurance as it ensures that you will get a contribution to the cost of your repairs, remembering that there will often be a compulsory excess that you must pay in the event of any claim. While this is a more expensive premium, it has the most to benefit from any no-claims bonus that you earn each year that you are accident-free. In addition these policies usually come with inclusive Third-Party cover on any other vehicles that you may drive but are not the registered keeper. Finally, such policies can provide additional benefits such as limited travel with your vehicle abroad and breakdown services.

The engine size of your vehicle determines its fuel consumption, road tax-band, acceleration rate and top speed. Measured in cc on your registration document, the higher the number, the more you’ll pay all round. Drivers of cars with a high cc-rating are deemed to be a greater risk on the roads and therefore pay more. Performance or sports car-drivers could benefit by taking a policy from a specialist insurer.

Modifications (such as different wheels, specialist paintwork and expensive in-car entertainment) may add value to a car but are often responsible for hikes in premiums when compared against the standard factory-fitted features of a vehicle. Check the policy options to ensure that you are covered for any additional equipment or alterations that have been made. Again, only certain insurers provide enough cover for high-value modifications.

Alarms Immobilisers and Tracking Systems can have a positive impact on your premium, lowering it against vehicles without these features. Most modern cars are fitted with an alarm and immobiliser as standard, but after-market (non factory-fitted) options can help particularly where the vehicle is of a high value. Premium makes of car typically benefit from the highest-rated alarm and protection systems but are not usually fitted with tracking devices as standard. Although these are at an additional cost (and with an annual subscription to pay), it can mean the difference between the return of a cherished vehicle and it being never recovered.

Your annual mileage. Statistically, drivers that clock-up more miles on the road stand a greater risk of being involved in an accident. It’s important to consider any change in your circumstances at renewal time. For example, drivers in their previous insurance year that had previously been using their vehicle to travel to work will benefit where this is no longer the case (for example, those who have since retired, work from home or travel on public transport will be using their vehicle less. This is often forgotten about at renewal time but can make a difference to lowering insurance premiums.

Your occupation tells your insurer more about your driving habits that you might think! Certain jobs mean drivers are considered a greater risk on the road, whereas others will determine whether the vehicle is to be unattended for long periods of time. Insurers use different methods to calculate your risk so it’s important to choose the occupation that closest matches your job title. Remember to tell your insurer if this has changed during your period of insurance or at renewal time.

Additional Named Divers add £s to insurance premiums. When calculating your quote, insurance companies will check out their driving history as well as yours. If it’s not a favourable history as explained above, then expect to pay much more as their motoring convictions, previous disqualifications and length of licence are all counted into the price you pay.

Ready to choose an insurer? Visit our Car Insurance table.