If you are a driver then no doubt you have been exposed to a variety of myths surrounding the car insurance industry. These myths are often greatly misleading and can prevent you getting the very best deals.
It is commonly thought that the cheapest car insurance is in fact the best choice, but this isn’t always the case. Although price is an important consideration, due to the high level of competition in the car insurance industry many insurers have scaled back the benefits that they offer as part of a standard insurance policy in an effort to make their policies look cheaper than their competitors. These benefits include such things as a courtesy car and windscreen cover. Because of this it is vital that when comparing prices you compare policies on a like for like basis as you may find that when you take into account the extras that you require a policy that initially appears cheapest is actually more costly.
It can be tempting to choose third party insurance rather than opt for a fully comprehensive policy, especially if you are a newly qualified driver, as third party insurance offers less protection. However, recent research suggests that this isn’t always the case, and that surprisingly third party insurance can be cheaper, even for younger drivers. Traditionally, those who are new behind the wheel have opted for third party cover in an effort to reduce their premiums. Insurance providers have responded to this increased demand, and therefore increased risk, by bumping up the cost of third party insurance.
It is a mistake to think that insurers reward their customers for their loyalty. Most insurers gain your custom by initially offering you a competitive deal during the first year of your policy, but then go on to increase your premiums by a considerable amount when your policy is up for renewal. That’s why it pays to switch your insurer on an annual basis, or at the very least contact your existing insurer to ask if they can offer you a better deal.
Many of us like to use online comparison sites in order to find the best deal for our car insurance. There is, however, a misconception that these sites prove more costly in the longer term as they charge commission. Comparison sites do not actually charge any commission, and research has shown that consumers can save an average of thirty five percent on their premiums by using a comparison site.
Car insurance for new drivers can be very expensive, and some young people wrongly assume that they can cut the cost of their premiums by insuring their car in their parent’s name; a practice known as ‘fronting’. Fronting is actually against the law and will invalidate your insurance. This means that if you are involved in an accident you would find yourself without cover.
If you have fully comprehensive car insurance then you may presume that you are able to drive any car. To some extent this is true as you are able to drive another person’s car as long as they give you permission. However, bear in mind that coverage is limited to third party cover only, therefore only the cost of damage to another vehicle would be included, and not damage to the car you were driving. You could then become liable for any costs incurred.
It is widely thought that new cars are always more costly to insure. Whilst this assumption is based on fact to some extent, in such that a more expensive car costs more to insure, there are other important factors that dictate the cost of car insurance premiums. More modern cars have better safety features and are thus harder to steal, plus they include new technology that makes them easier to drive and to park than older vehicles. These factors actually result in a decrease in premium prices so do not discount the idea of buying a new car simply because you think that the insurance will automatically be more expensive.
If your car is broken into and the contents are stolen you may presume that the cost of replacing these items will be covered by your policy. This actually may not always be the case as most policies include an upper limit on how much you can claim for items left in your car. This is why it is important to remove all items of value, such as tablets and mobile phones, when you leave your car unattended.
If you are involved in an accident and it is not your fault then you would probably expect your insurer to waive the excess. This, however, is only the case if the other party admits that they are at fault. If the individual with whom you were involved in the accident is not insured, or they cannot be caught and action taken against them, then you would still need to pay the excess in a no-fault claim.
Finally, if you were to be involved in an accident after just a few months of paying premiums on a new policy and your car was a write-off then you would not be able to claim back the remaining premium. In fact, if you were paying on a monthly basis you would still be obliged to continue making payments until the policy term elapses.