Car insurance is there to give you financial protection in the event of an accident whether or not you are responsible for it. In the UK, car insurance is a compulsory as well as a necessary expense. If you have an accident in your car, you will be glad that you invested in good car insurance for the financial protection that this will give you.

Not all insurance policies cover you against damage to your own vehicle, or liability for property damage or legal fees. Bolt-on niche insurance products such as inconvenience cover, gap insurance and even legal protection insurance can prove to be invaluable additions to your comprehensive car insurance to ensure an accident does not end up costing you more than you can afford should the worst happen.

Choosing the right car insurance will protect not only you, but your vehicle, and third parties in the long run. If you are planning to drive in the UK, you are required to purchase car insurance. There are different levels of cover which are determined by the type of car insurance policy you choose to take out.

WHY YOU SHOULD SHOP AROUND FOR NEW CAR INSURANCE

Shopping around for car insurance is very important for several reasons: • You may find better quotes • Effects of car depreciation • Your circumstances may have changed • Car financing could put you and the car in a higher risk category • Personal effects loss may be covered by some insurers • Breakdown cover may be included in some policies • You may find inclusive legal cover offered by some insurers • You could find a policy which includes cover for a second car • You may be offered an introductory discount

Just because you have used the same insurance company or insurance broker for several years, does not mean you are getting the best deal. It doesn't always follow that the same company or broker can offer you the best deal for your insurance.

A good insurance broker is most likely to get you the best coverage if they manage your full insurance portfolio as they then know your history and needs. They may be able to consolidate those demands and needs into a package which often will only be available via a broker.

Your car will depreciate in value according to both age and usage. Your new car begins to depreciate as soon as you put the first few miles on the clock. Your car's value will decrease every year. You should therefore insure accordingly by adjusting your car's declared value at renewal time. This is an obvious statement but can be surprisingly often forgotten. So always ask your broker to check the value of your car against its blue book value, rather than the purchase price. The reason is that even fully comprehensive car insurance policies do not cover a vehicle to the purchase price, but rather the blue book value. So ensure you are as accurate as possible when declaring the car's value. The more expensive a car is the more it can cost to insure. The exceptions to this rule may be when an insurance company offers to replace your car in the case of the accident for the exact same car or new car of same specification, but this is rare and the chances are that this will not be the case. There is however an insurance product called Vehicle Replacement Insurance which does just that! Click on the link to find out how it works in more detail.

Your car insurance could be affected if your circumstances have changed since your last renewal. You may have switched jobs and not drive as many miles per year or have paved the front lawn and turned it into off-street parking. Get insured accordingly. Insurance companies lower their prices for low mileage drivers and discounts can be significant.If you wait until renewal time it probably won't be that expensive to add additional drivers to your car insurance policy. Insurers may charge you an administration cost for adding additional drivers, but if you wait until it's time to renew you may not incur this fee.

WHICH LEVEL OF CAR INSURANCE IS THE BEST CHOICE?

There are three types of vehicle insurance in the UK.

 1. You must by law have the minimum of Third Party Insurance in many countries, including the UK. If you are involved in an accident, this type of cover will protect you financially against damage to the other vehicle or its occupants. Third Party Insurance acts as security against liabilities for damage to another person in a vehicle accident. This does not cover any damage to the vehicle or the driver of the vehicle. This type of insurance will not cover repairs to your vehicle.

2. Third Party, Fire and Theft Insurance will cover the benefits of third party insurance and includes any financial loss to the insured vehicle caused by fire or theft. For a vehicle that does not have a high market value, this is often the best cover for the average driver. A leased or financed vehicle will require a fully comprehensive insurance cover.

3. Fully Comprehensive Insurance offers the widest coverage. As well as providing basic cover as in third party, fire and theft, it will also cover vehicle damage and bodily injury sustained in an accident. A fully comprehensive policy is a better choice if the value of the car is more than you could afford if you needed to replace it. Search online for products like Vehicle Replacement Gap insurance or Finance Gap - these will close the gap between what your payout would be and the cost of buying a new car in the event of an insurance write-off.

Many factors affect car insurance and most insurance companies offer a range of secondary covers to meet the varied and specialized needs of the policyholder.

FACTORS AFFECTING CAR INSURANCE

1. The Policyholder• Age of the policyholder • Gender of the policyholder • Your marital status • As a policy holder your address affects your premium • Engine and car size • How much your car will cost to replace • Any modifications that have been made to the vehicle by its owner

A younger less experienced driver will pay a higher insurance premium than someone with several years driving experience.

A married person is considered more responsible for their actions than a person is with no commitments. It stands to reason that married men with kids have more responsibilities than single men and the insurance companies therefore consider married men a lower risk category.

Where a person lives also affects the insurance cost. If you live in the country or in a low crime rate location you are likely to get a lower premium than if you are a city-dweller.

A powerful car is more likely to lose control at the hands of younger drivers: expensive cars cost a lot to replace if scrapped and should they simply require repairs the sum of the replacement parts often costs more than the used car’s value, making more powerful cars very expensive to ensure.

A modified car could have had safety compromised in terms of improved performance and different handling which could make the car unpredictable. An increase in insurance premiums should be expected with car modifications, as these represent an increased risk to the insurer.

2. Driver History • Years of driving experience • Claims made in previous years • Driving convictions • Annual mileage

The number of years a person has been driving suggests their understanding of the rules of the road, shows the driver has built up experience of driving under varied driving conditions and has attained a certain level of confidence while behind the wheel. Insurance companies base these assumptions on the policyholder's claims history over the last five years. Driving convictions such as speeding, dangerous driving or drink diving will affect the premium. Parking violations are not included.

Your an
nual mileage is a factor too. Your chances of being involved in an accident are increased the more time your car spends on the road.

3. Vehicle History • Current vehicle value • Is the car owned, leased or financed • Car make and model • Performance level and size of engine • Modifications to the vehicle

If the vehicle has a low book value, it may not seem to be cost effective to pay for comprehensive insurance; however this is not necessarily the case. Often as the named driver with many years of no claims under the belt, fully comprehensive motor insurance could cost no more than third party insurance, but with additional perks. Buying car insurance online can mean including a range of additional benefits with only a small increase to your premiums. It is mandatory for a leased or financed vehicles to have fully comprehensive insurance. You need to be able to reimburse the leasing or finance company for any damage to the car. This will be covered if you have fully comprehensive insurance.

There may be other benefits included in your car insurance policy, which are not always necessary but sometimes advisable:

 • Breakdown insurance • A courtesy car could be offered while yours is being repaired • Roadside or breakdown cover • Some insurers may offer you legal cover included in your policy • Windscreen cover - repair or replace • No Claims protection • Compulsory or voluntary deductible amount

Choosing the correct insurance and getting the best quote can be daunting as there are so many variables to consider. The right car insurance price is easy to find when you're on a great website. Consider using an insurance aggregator website for your initial quotes. Aggregator websites are easy to use. They will search the insurance market for you and show you the products which best match you needs based on the answers to some initial questions. After the site has collected the quotes, you can then compare different policies, as well as being able to save your quote, amend your requirements if necessary and if you are happy you can then buy online. Before you buy online, call your broker to see if you can get a better deal based on your findings. It's important to remember that you should compare like-for-like quotes when looking at different insurers. It could be more complicated than you at first think. Good luck on finding your ideal car insurance.