Motor Insurance

Introduction

In UK it is a legal requirement that the vehicle those meant for driving in the public roads or streets should possess a valid insurance which shall, on a minimum, provide cover for any damage or injury to any other person, vehicle, animal or property in the event of an accident. However, the type of insurance and the coverage level are entirely up to you

Types-of-insurance

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Generally, Motor insurance can be divided into the following categories:
1. Third-party
2. Third-party fire and theft
3. Comprehensive
4. Motor Breakdown Insurance.

Third-party

Third party insurance is the legal minimum. This means you’re covered if you met with an accident-causing damage or injury to any other person, vehicle, animal or property. It does not cover any other costs like repair to your own vehicle.
Due to the limited protection offered by third-party motor insurance, these policies are often cheaper than other types of motor insurance in the UK.
Third-party fire and theft
Third-party insurance, fire, and theft cover the same risks as third-party car insurance (i.e., damage or injury to another person, his or her car, or property) and in addition to it also pays for the costs involved:
•    Recovering your car if it is stolen
•    Damage caused to your vehicle attempting to steal (for example, broken windows or locks)
•    Damage caused to your vehicle due to fire

Comprehensive

Comprehensive car insurance covers risks those covered by third-party fire and theft insurance and also covers all the damage of the own vehicle, someone else’s vehicle and personal injury. In fact, in the event of an accident where you are at fault, a comprehensive cover will cover all the damage to your vehicle and someone else’s vehicle. Under Comprehensive cover, the insurer will pay to reimburse your car or vehicle under cover if it has been damaged beyond repair after an accident. The final payment you receive will be equal to the current market value of your vehicle, taking into account the age rather than the amount you originally paid

Motor Breakdown Insurance:

Breakdown Cover provides roadside assistance in the event that your vehicle breaks down such as Roadside Rescue, Roadside Recovery, Alternative Transport, Onward Travel, keys locked inside vehicle etc.
Breakdown cover it is not a legal requirement, however a motor breakdown can happen at any time regardless of the age of your vehicle. By getting covered, you can rest assured that a helping hand will always be there, 24 hours a day, 7 days a week



What type of motor insurance do I need?

Many factors determine the type(s) of motor insurance you should choose. The following are some of them,

1. Legal Identity
Many states require minimum liability insurance, which compensates for medical expenses and damage to property if you are responsible for an accident.
2. Financial Protection
In the event of a collision or breakdown you may have to take part in repairing your vehicle as well as other medical bills or repairs. Adequate insurance coverage ensures that most of those debts will go to your insurance company instead of to you.
3. Borrower Needs
If your vehicle is rented or if you have a loan you owe, the lender will probably need more cover than a small amount of your state. This is because the lender is the vehicle’s legal owner and you need to make sure it is financially secure in the event of a collision or other damage.

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Which type of motor insurance is cheapest?

The cheapest type of motor insurance will depend on your circumstances. However, a full-length cover is usually the most affordable option. It was sometimes needed until insurance brokers realized they were getting more claims on foreign company policies only because young or new drivers could choose this as the cheapest option. This only increased the price of foreign companies’ policies, so the trend backfired – and now, fully-integrated coverage is the most affordable

Conclusion:

However, your motor insurance is an essential financial tool. If you or your vehicle is involved in a crash, theft, natural disaster or breakdown, the impact on your bank account can be devastating.