This is the time of year when you may have spent more than you intended and wouldn’t mind finding ways of reducing your household expenditure. A potential option could be to make some changes to the type of car insurance that you have but, if that is something that you are considering, you should think very carefully before doing so.
First and foremost, the important thing is that the type of car insurance you have provides the cover that you need so let’s have a look at the three types: –
Third party car insurance
This is the cheapest form of car insurance and it is a legal requirement that you have this level of cover unless your car is declared SORN (Statutory Off Road Notification).
Cover is rather limited in so much as you are insured against damage caused to other people’s vehicles and property and injury to other people but you are not covered for any damage to your own car or yourself. This form of cover may be suitable if, for instance, your car is of a very low value.
Third party fire and theft car insurance
This level of cover is more expensive than third party car insurance as it will cover you for everything that is included in third party insurance plus your car would be covered if it was stolen or set on fire.
Fully Comprehensive Car Insurance
This is the most expensive type of car insurance but, as indicated in the title, it provides the greatest level of cover.
Not only does it include cover for everything detailed in third party and third party fire and theft but it also covers your own vehicle should it be damaged in an accident.
So, if your car were of a reasonable value, it may be sensible to consider this level of cover.
There are other ways of reducing your premium other than just choosing a lower level of cover. For instance, if you are able to park your car overnight on your drive or in the garage that may be cheaper than leaving it on the road outside your home. If you have an alarm, engine immobilizer or tracking device fitted that may reduce the premium. Be selective about who is named on the policy to drive the car rather than just allow any driver to drive the car. Be realistic about the number of miles you anticipate travelling each year in your car as if it is insured to travel 25,000 miles per annum and you only do 5,000 miles per annum you are likely paying too high a premium.
So, before making a decision about changing the level of car insurance you have to save money think twice!