Car Insurance Buying Guide

It is a legal requirement to have valid car insurance. There are stiff penalties and fines for driving a car without sufficient car insurance.

Once you've started looking into buying car insurance, you may be confused by the different types. Basically there are three main types: Third Party Only, Third Party Fire & Theft, and Comprehensive.

The first one covers you (the policyholder) against damage to someone other than yourself (the third party) and/or their property. What this means is that you will be covered for repair to another vehicle and for medical expenses for anyone other than yourself in an accident involving your car. This type of policy does not cover damage to your car nor does it cover medical expenses for yourself. There is also no coverage in case your vehicle is stolen or catches fire

Third Party Fire & Theft is exactly like Third Party Only except that theft of your vehicle and it catching fire are covered. Damage to you and your car is still not covered.

Comprehensive insurance cover (also known as fully comprehensive) will see the insurance company making payments to all of the areas listed above. In other words, it will pay for damage to third parties and their property, it will pay if your vehicle is stolen or catches fire and it will pay for damage to your vehicle in an accident.

• Obviously the more comprehensive the type of cover, the more expensive the insurance will be. But there are other factors that affect cost:
• Age - the less experienced you are as a driver and the younger you are, the more costly the premiums.
• Engine size - the bigger the engine, the more expensive the premiums.
• Value of your car - the cost to replace or repair the car factors greatly in the premium cost.
• Insurance group - the majority of cars on the road today are grouped by risk by the insurance industry. An example would be two small hatchbacks being of similar risk and thus in the same or at least neighbouring groups. A high end sports car like a Ferrari would, however, be in a much higher risk group; Your motoring history - if you have a history of traffic offences then your premium will likely be higher.
• Your job and its associated mileage - if you drive as part of your job then you will accumulate more miles than someone who drives primarily on weekends and thus be deemed a higher risk.
• Where you live - in general the more densely populated an area you live in the more likely you are to have an accident or have your car stolen - thus the premium will be higher.
• Options of the insurance cover - the size of the excess charge and any other benefits that might be part of the cover. An example of a benefit would be a courtesy car will yours is being repaired. Regarding the excess charge the higher it is, the lower your premiums will be.