What's the right car insurance policy for me?
Everyone needs car insurance – in the UK it's the law. But there are so many different policies out there; it can be hard to know which one to go for. From third party to comprehensive, we're busting the jargon to help you find the car insurance policy that suits you best.
This is the absolute bare minimum. It covers other road users, but not you or your car. So if you have a prang, your insurance company will pay for the other driver's repairs (and any injury your passenger might suffer, such as whiplash) but you'll be on your own.
Choosing third party is a big risk – accidents do happen, and if disaster strikes you could be seriously out of pocket. And surprisingly, it's not always the cheapest policy to choose, according to price comparison sites. This is because it's favoured by young and inexperienced drivers, who are statistically more likely to have an accident.
Third party, fire and theft
This is a bit of an upgrade on third party. It covers your car if it gets stolen or bursts into flames. You're only covered if it’s a non-fault accident though.
This type of policy gives you the highest level of cover. It covers all types of accidental damage to your car, even when it's your fault – such as when you accidentally bump the wall in an underground car park.
Some policies include third party cover in someone else's car. Just make sure you ask your dad before taking his pride and joy out of the garage.
This could be best for homes that have a few cars parked in the drive. Multi-car insurance policies cover up to five vehicles in one household. They can work out cheaper because insurers offer a discount for the extra business, a bit like buying in bulk.
Different companies have different terms and conditions. Some will only insure families, while others count a group of flatmates or a couple as a household. Some even cover young people away at university, even though they technically don't live at the same address.
Black box (telematics)
This type of insurance is generally aimed at young and inexperienced drivers. You have a black box installed in your car and it records information about how you drive. It sends this data on to your insurer, as well as information about what time of day you use the car and what type of roads you use. Your insurer can look at the data and reward you for driving safely with better premiums.
If you’re a new driver, O2 Drive Box on Board could save you money and help you feel more confident. The device fitted to your car sends data that could give you a discount on your policy when it’s time to renew. With the O2 Drive app, you can get tips to help improve your driving skills.
See more articles to help you to drive smarter and make the most of your car.