What is Comprehensive Car Insurance?
If you are new to driving, getting your first vehicle insurance policy can seem like a bit of a minefield. There are two main types of cover; Comprehensive and Third Party, Fire and Theft. Here we explain the difference in simple terms:
Comprehensive car insurance is the highest level of cover a person can have if they take out motor insurance in the United Kingdom. By taking out a Comprehensive policy, drivers are not only covered for third party claims after an incident, but also for any damage caused to their own vehicle in the process.
Depending on the policy there would be different excess payments (more on this below) made to the garage that ultimately repairs the vehicle. The insurers would normally need to authorise the estimate before any work commences. Once the authorised garage has completed the repairs, the policyholder would then pay the excess, with the insurers paying the remainder.
If the claim was deemed not to be the driver’s fault, the insurance company would then chase their financial losses through the other insurance company involved. In some cases, they could be unsuccessful, or due to the lack of evidence, only manage to agree 50/50 split and get half their losses back.
What is Third Party, Fire and Theft?
With Third Party, Fire and Theft, the policy covers exactly what it says on the tin. So if the policyholder is involved in a crash that is deemed their fault, the insurance company would only cover payments to the third party. Work on the driver’s vehicle would not be covered in this instance. If the car was damaged through fire, or was stolen, then insurance cover is present once again.
Which is Best – What is Comprehensive Car Insurance?
If you are able to afford comprehensive cover, it is almost always worth it in the long-run. The peace-of-mind that it brings is almost worth it especially if you have an expensive car. If you choose to lease a vehicle or purchase it using a bank loan, then the lender may stipulate that comprehensive cover is required and put in place, as part of the agreement.
The Excess Payment
The excess payment that is chosen at the outset of the policy will affect the ongoing monthly premiums. That means that a higher excess will make the premium lower, and vice versa.