Let’s face it, insurance is a word that strikes fear into the hearts of many young drivers and their parents simply because of two basic facts:
1. YOU MUST have insurance to drive.
Without it you commit a crime and if you are caught (and remember that the police can get more information about more cars and whether they are taxed or not with just a quick check) you will not only face a fine of £ 200, but you will lose your hard-earned license.
2. Insurance is expensive.
Especially if you are a man. Statistically women have a safer driving record, so now insurance is cheaper. However, in December 2012, after decisions of gender discrimination in European Courts insurance companies will not be able to charge different rates based on gender. So girls’ insurance will definitely go up – but the question is, will it go down for boys?
If you are learning to drive you are thinking about how to get the best insurance is probably the last thing you want to think about. But you should – as soon as you start saving! It should also affect the type of car you dream of owning.
For the first time a driver to understand the policies that insurance companies use can be confusing. Here is a list of helpful insurance terms that will help you think about the insurance you will need in your first car.
Insurance groups start at 1 – 50. If the party is low, the insurance is low. The higher the group, the more expensive your insurance will be. There is a great online guide at Parkers that will show you which cars are in the group, and where to look for the car group you are looking at.
This is the amount you will pay for your insurance. You can usually pay for the insurance in one installment per year, or in monthly installments. While monthly payments may be more expensive for your budget, they will cost you more than a year.
While you should learn to write a little bit of your insurance policy very well, General Insurance covers every car you drive and any car, property or person that hurts you. Complete insurance is often more expensive, although some insurance companies offer only this option. If you are hit by an unsafe driver your insurance will pay for the repair of your car.
Third, Fire and Stealing
Third Party is basic insurance – the car you drive is not covered, but whatever you hit is that. Fires and theft are often filed, which means you are covered if your car is hot or stolen. You must have a third party insurance as a minimum.
If you have caused an accident or caused an accident and your insurance company is involved in paying for the damage to be repaired, or in any legal action, then you will have filed a claim. Sometimes if you have caused only minor damage to your car, or someone else’s car. If someone, for example, crashes your car and the light is broken, they will probably pay for the damage to be repaired without going through the insurance company to avoid making a claim that will affect their No Claims bonus. If the damage is too great this is inevitable.
No Claims Bonus (NCB)
As a new driver you will not have a claims bonus. You get this every year you drive without making a claim on your insurance. You should aim to avoid making claims at all, so build your bonus into a higher amount. This could be something like 70% off your discount after 7 years of free driving to build your bonus will cost a lot of money. If you make a claim you will lose everything, or one of your NCB depending on how old you are.
When you create a large claims bonus you can pay extra money each year which means you can make one or two claims (depending on the insurance company) without affecting your claims bonus. Although the NCB will not be affected, you will find that your insurance will increase next year due to an accident. So you have to look at exactly how much this extra protection will cost to decide if you should have it. In your early years of driving you probably don’t deserve it.
If the insurance is in your name you will be Named Driver. No one else will be able to drive your car unless you add them as named drivers, and declare their driving history, age and experience. Having older people, like your parents as drivers with names in your goal can reduce your insurance costs.
You can be a registered driver in your parent’s car if they are traveling in a car with a lower insurance group, but you should check carefully to make sure their insurance will allow you to build a claim bonus yourself.
It is illegal for your parents to prove to you that you are the main or the only driver in order to lower your insurance premium. In this case you may find that if you have to apply the insurance company will not pay you, and you may be sued for many thousands of pounds, as well as points for fines for successful driving without insurance.
Some insurance policies, especially for older and more experienced drivers, allow them to drive your car under their insurance without having your name disclosed on your insurance policy. It is your responsibility to make sure that anyone who allows your car to have the right driving policy, so make sure they have checked their insurance documents, and ask to see a copy if you, or they, have any doubts about whether or not they have insurance.