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What types of Car Insurance Policies are available?
Ever since 1930 it's been a legal requirement for drivers to have at least "third party act only" insurance. This means that if you had an accident on a public road and it was your fault, then your insurance company would pay for the repairs to the other drivers' vehicle or property.
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But, whilst third party act only motor insurance is the lowest category of car insurance cover, it is rarely sold. Three other insurance options will be far more familiar: -
Third Party Insurance
Third party insurance pays for the repairs to the other persons' car or property if you are driving on any road (and that's not just a public road) and you have an accident which was someone else's fault. But, if the accident was your fault, your insurer would meet any claims for personal injury from third parties. This insurance also covers you for some legal liabilities - for example passenger indemnity. So, if you are driving just with third party insurance and one of your passengers were to open a door and knock down a cyclist, you would be fully insured.
Third Party, Fire and Theft Insurance
Third Party Fire and Theft is the next level of cover up. It consists of Third Party Cover plus insurance for damage or loss to the insured's vehicle if it was caused by fire or theft or attempted theft.
Comprehensive Insurance
If your car is valuable* you will certainly need fully Comprehensive Insurance. Comprehensive cover insures you for damage to your own vehicle, no matter who caused the accident, and damage to other people's vehicles and property if the accident was your fault. (*by the way, if your vehicle has been purchased on finance, it will always be a condition from the finance company that you have fully comprehensive upon the vehicle.)
A Comprehensive policy will also meet any personal injury claims from third parties, including your passengers. Most of these policies also provide a death benefit (frequently about £15,000 but please check your policy documents) and loss of limb benefit for the driver.
Please Note - Until the insurance company issues a policy certificate or cover note, your car insurance is not insured. If you can't produce a valid insurance certificate for the vehicle if you are requested to do so by the police, then that's a criminal offence.