What to Look for in a Car Insurance Policy
Car insurance is essential for anyone driving their car on a public highway. It’s a way to protect yourself and others from the risks associated with owning and operating a vehicle.
If you’ve ever felt confused when browsing car insurance policies though, you’re not alone. In this guide we’ll give you a rundown of what to look for to make sure your policy fits your needs.
Here’s what we’ll cover:
- Key features to look for in a policy
- Understanding exclusions
- Specialist insurance types
Key features to look for in a car insurance policy
For regular road users, finding the right policy means striking a balance between protection and affordability, leading to maximum peace of mind. Below we explore some features to evaluate.
Coverage type
Third party coverage is the legal minimum in most countries, and only covers damage to other people and their property. You, your vehicle and your property are not covered.
Comprehensive coverage, on the other hand, covers third parties as well as damage to your vehicle, fire, theft, and other incident types. While these policies have higher premiums, they offer much higher peace of mind.
Optional addons are sometimes available and offer extras like roadside cover, battery cover, and other types of cover to protect in unseen eventualities.
Premiums and deductibles
Premiums determine how much you’ll pay each month and are calculated by taking into account your driving history, where you live, the vehicle type and numerous other factors.
Deductibles are payments you make when making a claim before your insurance kicks in. Paying higher deductibles can reduce premiums, but may increase the financial burden in case of a claim.
Customer service and claims process
The ideal insurer will have a quick and hassle-free claims process, with agents reachable any time of day via phone and other contact methods.
Understanding policy exclusions
No matter how comprehensive a policy appears, it’s worth having a clear idea of what it doesn’t cover. Policy exclusions vary, but here are some common ones to watch out for:
- Wear-and-tear or mechanical breakdowns
- High-risk activities like racing, unless covered by specialist insurance
- Commercial use, unless you have a policy specifically designed for that purpose
Always read the fine print: even if it feels like a lot of effort, it’s a good way to avoid a nasty surprise down the line!
Specialist insurance types
While regular car insurance meets the needs of most road drivers, there are other types of vehicle insurance available to meet other users’ specific needs.
Motorsport insurance
Motorsport insurance is designed specifically for racers, both amateur and professional, who take part in high-risk race events. This insurance type usually covers on-track incidents, as well as protecting co-drivers, organisers, spectators and other at-risk parties.
This insurance type is designed to protect against the unique risks of the sport, and will be tailored according to the type of event(s), the vehicle(s), and the driver’s experience.
Classic car insurance
This insurance type is tailored to the unique needs of the owners of vintage or collector vehicles. Classic car insurance policies are distinct from regular insurance because they account for the value, usage, and preservation requirements of classic cars.
Such policies will often include agreed-value coverage and coverage for specialised repairs, while potentially placing mileage restrictions on the vehicle itself.
Commercial vehicle insurance
Commercial vehicle insurance is essential for owners of vehicles used for business purposes, such as transporting goods, passengers, or equipment. Without this type of policy, using your car for work can invalidate standard personal insurance.
Such policies can be expanded to cover fleets of vehicles where a business requires more than one to meet its needs.
In conclusion
There are a variety of motor insurance options available, each tailored to meet the specific needs of different drivers and vehicle owners. Hopefully this primer has been useful in acquainting you with the different types.
When you’ve identified the right insurance type to meet your needs, potential insurers will evaluate factors such as your age, location, the type of vehicle you drive, your driving habits, and whether others will be included on your policy.
By familiarising yourself with the different types of car insurance, you can select a policy that offers adequate protection. Taking the time to compare providers and their offerings will help you make an informed choice, keeping you protected on the road while giving full peace of mind.
