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Iceni Magazine | July 2, 2022

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A quick guide to car insurance types and costs

A quick guide to car insurance types and costs

Do you need to get cover for your car? Whether it’s your first vehicle or your first time organising insurance, it might not be the most exciting element of driving.

But it’s illegal to get behind the wheel without insurance in the UK – and being covered will give you peace of mind should anything go wrong.

At the same time, the car insurance market can be confusing. There are lots of different types available and even more providers, while costs can vary wildly with little explanation. Read our quick guide below to steer yourself in the right direction.

Types of car insurance

There are three basic levels of car insurance cover in the UK:

  • Third party is the minimum legal requirement. It covers you for any damage or injury you cause to other people or their property – but not for damage or theft of your own car.
  • Third party, fire and theft is a step up and offers the same protection as third party, as well as covering repairs or replacement if your car is stolen or damaged in a fire.
  • Comprehensive insurance is the highest level of insurance available and covers you, your car and anyone else involved in an accident. Some policies also include compensation for things like medical treatment and legal expenses, as well as allowing you to drive other vehicles.

There’s also temporary car insurance, which is ideal if you only need cover for a short period like a holiday or an emergency.

What affects the cost of your policy?

According to MoneySuperMarket, the average cost of comprehensive cover in the UK was £412 a year at the end of 2021. But there are lots of different factors that might mean your insurance is significantly higher or lower:

  • Your age (younger drivers typically pay more due to lack of experience)
  • The make and model of your car, as more valuable cars usually cost more to insure
  • Your annual mileage – higher mileage means more risk of accidents
  • Your address and where you store your car, plus the crime rate in your local area
  • Your driving history, including any recent convictions
  • Whether you have a no-claims discount and how big it is
  • Whether you add any named drivers to your policy and how experienced they are
  • How much voluntary excess you’re willing to pay

The type of cover you choose also affects cost – and surprisingly, third party insurance often works out the most expensive. Extras like breakdown and windscreen cover usually bump the price up though.

Ultimately, providers base their premiums on how big of a risk they judge you are to them in terms of making claims. Understanding what cover you need and what you can do to lower costs will help you find the right protection for the road.


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