Car insurance is an integral part of motoring. It’s a legal requirement that every driver in the UK has it. Third party insurance is required for every driver. It covers injury to passengers, as well as damage to property. Only a third party could claim against you in a claim situation.
Although this is the minimum coverage required by law, it does not cover all situations. If your car is in an accident, or your car is damaged, you could lose its value.
Third party, fire and theft is the next level. This covers you if your vehicle is stolen or set on fire. This coverage does not include personal property or any extras you have added to your car.
Full coverage is the most popular. It covers you in the case of damage to third parties, fire, theft, damage to your car, as well as any loss or theft of goods.
When you make a claim on your car insurance, the first thing to do is to determine what coverage you have. The type of policy will not only determine the nature of your claim, but also the details of the policy.
Does your insurance cover replacement locks, for instance? Are you able to claim for personal property? If so, what items are covered and what is the value?
It is important to note that many people have home contents coverage which covers items transported in your vehicle. Check the differences in policies to find out which insurance policy is best to claim.
When making a claim, there are two main factors you should consider: your excess charge and the no-claims bonus.
An excess charge is the amount you will pay in case of an accident. The excess charge can be set by your insurance provider as a mandatory or voluntary charge. In either case, the golden rule of thumb is that the higher the excess you pay the lower the premium.
An excess charge can make the difference between filing a claim and not.
For example, if you agree to paying an excess of £200 that means that if you have an accident that costs £400 to repair your vehicle, you pay £200 and the insurance company pays £200. If your claim is less than £200 then the insurance company will not pay anything.
You can make a claim as long as it is greater than the excess.
It doesn’t have to be. That brings us to the next major factor.
– No claims bonus
Some people find the thought of losing their bonus without a claim terrifying. If you have five years of no claims, you can get a no-claims bonus policy that will save you up to 65% on the premium.
Your no-claims bonus details will vary from one policy to the next. With some policies, there is no quarter. If you make a claim you forfeit your bonus. Some policies allow you to make up to two claims in a given time, but you lose your bonus if you make a third.
Protected no claims bonus policies are available where you can pay an additional premium to secure your no-claim bonus. This allows you to save money even if you need to file a claim.
Although it may seem simple, submitting a claim can require careful consideration of all costs. You need to consider not only the cost of the claim, but also the impact it will have on the premium.