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There is a lot of data written about car insurance which can seem complicated at first until you know a few basic points. I have written these notes to help you understand some of the more common terminology a little more clearly.
First of all you need to understand that you need to have your car insured by law if you intend to drive it on the public roads. This is for two main reasons
There are many different types of insurance you can have for cars, here are the ones that concern you as a new driver.
3rd party insurance-
This is the minimum type of insurance you need to have by law. What it means is if you are involved in an accident, the person you hit (vehicle, goods, or person themselves) can claim money from your insurance company. You cannot claim damage costs to your car if it is your fault.
3rd party fire and theft - insurance
This covers your costs as shown in item 1 plus if your car catches fire, or is stolen, then you can recover some of the costs involved in replacing or repairing your car.
Comprehensive - insurance
This means that you are covered for items 1 and 2, plus you could have your car repaired at the insurers cost even if the accident was your fault.
The first type of insurance mentioned i.e. 3rd party does not cover you for repairing your own car.
The no claims bonus discount
Is as the name suggests. If you do not make a claim then your insurance costs will be reduced the following year.
You would normally get a 30% discount on your yearly premium if you don't make a claim within that year. Your Pass Plus* discount could cover your first years premium. A no claims insurance bonus increases to 65% after four or five years. Not all companies are the same though, you should shop around. Some may go up to a 70% maximum.
Insurance companies now offer the opportunity for you to pay more on your annual premium to insure you against loss of your no claim bonus. The different car insurance companies have different rules, so check before you buy.
Sometimes you are allowed to make one claim every 3 years without it affecting your bonus. Protecting your bonus will not stop your insurer from increasing your renewal premium following a claim. Your no claim bonus though will be unaffected.
Making a claim does not necessarily mean you lose your car insurance bonus. It depends whether the claim is your fault or the other persons fault.
Just because the accident was not your fault, still doesn't mean you are in the clear. If the insurance company cannot recover it's costs then you seem to lose out.
Green card car insurance system
All insurers must provide details of your car insurance policy to the MID. It's no longer enough just to have a car insurance, all vehicles must be listed on the MID.
Motor insurance database
Ref: car insurance info. from direct gov.
What to do if your vehicle is 'written off'
Check your car insurance is on the database
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Cheap car insurance
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