Although the basics of UK car insurance have remained unchanged for many years, many road users still find themselves in a state of confusion when it comes to buying a policy for the first time. Exactly what type of car insurance should a new road user buy, and how will the wrong policy purchase affect them if they are involved in a road traffic accident?
The most detailed form of UK car insurance is fully comprehensive coverage. This type of protection covers most situations where the vehicle of the policyholder is damaged, and also takes care of any financial liabilities relating to third-party drivers, their vehicles and their personal property. Fully comprehensive car insurance is usually purchased by owners of new vehicles, drivers with an outstanding finance agreement on their car or owners of high-performance models.
A little further down the scale is third-party (fire and theft) car insurance. Although this type of coverage will not pay the cost of repairs after a road traffic accident, it will protect the vehicle if it is damaged in incidents of fire and theft. This includes any damage that happens to the vehicle if it has been stolen.
The final tier of UK car insurance is the basic third-party policy and this type of coverage only offers protection against liabilities towards third-party drivers. Third-party policies are usually purchased by owners of older vehicles which have a comparatively low market value. All of these different policies make a driver Road legal, but vehicle owners can still find themselves underinsured if the correct levels of coverage have not been purchased.