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What is car insurance?

Having car insurance ensures you are covered financially if the worst were to happen to your car. Such incidents could involve damage from an accident, theft, vandalisation and fire damage. Car insurance means you won't have to dig into your pocket to pay for potentially huge repair or replacement costs.

Car insurance is a legal requirement for cars driving on public roads. You will be heavily penalised if you are found to be driving without insurance. The minimum level of coverage you must legally have is third-party car insurance. Third-party insurance covers the damage to another person's car, for example, in a collision accident, but provides limited cover for your vehicle.

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How much does car insurance cost?

Car insurance is either made up of an annual or monthly premium. Annual premiums are paid in a single lump sum when a policy is purchased; monthly premiums require a deposit and a monthly direct debit. Many factors come into play that will affect the cost of your car insurance. It needn't cost the earth when you take the time to compare premiums.

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Comparing Vehicle Insurance

Not all vehicle insurance provides the same level of coverage. This is one of the most significant factors affecting how high your policy’s premiums are, but there are others:

Some policies add extra limitations, reducing the policy’s cost, but it will not pay out if you’ve ignored these limits.

Two major examples of this are black box/telematics insurance and limited mileage insurance.  Limited mileage insurance is simple – if you go beyond the mileage you’re insured for, your insurance is invalid – but black box insurance can take a little more explaining. Named after the ‘black boxes’, which record aircraft flight data, it provides a clear record of your driving and can be used to prove whether you were at fault or not.

Vehicle insurance is broken down into several categories. These can include:

If you intend to insure multiple vehicles for your business, you may get a better deal with Motorfleet insurance. Most business customers should also consider goods in transit insurance.

There are also specialist packages for taxi drivers, minibus firms, and limousine hire companies.

Why is Vehicle Insurance Mandatory?

Vehicle insurance is mandatory because it provides financial protection to you in case your vehicle causes bodily injury or property damage to third parties. It also gives you financial support if you are injured in a traffic accident. In addition, car insurance companies can use their data to determine potential risks that may result from specific cars on the road and raise rates for those cars until safety measures can be taken.

Is It Possible to Transfer a Vehicle Policy?

Vehicle insurance coverage can be transferred from one vehicle to another. In fact, auto insurers encourage policyholders to move their auto insurance coverage to different vehicles within their households. The process of transferring the insurance coverage is somewhat different depending on the type of vehicle and insurer. Vehicle insurance providers will transfer coverage to a new owner when certain conditions are met, but these conditions can vary from one provider to another.

Before you transfer your insurance policy, make sure you have the following information:

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