Car insurance can be overwhelming if a driver doesn’t know much about it. There are also a lot of common misconceptions when it comes to car insurance, so in honour of National Car Insurance Day on 1st February, Your Red Car has addressed some commonly asked questions about what you can do and what you can’t do when looking for car insurance.
1. Comprehensive cover allows me to drive any car
Not true. You may often hear people saying that they are insured to drive any car, but this isn’t necessarily true. If you are ‘fully comprehensive’ on your own vehicle, this doesn’t mean you are insured to drive other vehicles alike.
Whilst some policies may offer this, it's not all. So, read the small print to find out if you have DOC cover (drive other cars). DOC cover is a common feature on comprehensive car insurance but not all, and there are usually criteria that will have to be met.
You may also find that isn’t offered to under-25’s. You shouldn’t drive another vehicle unless you are sure you will be covered, and you must always ask permission from the vehicle owner.
2. Third-party cover is always cheaper than comprehensive
Incorrect. Third-party cover is the minimum level of cover required by law. This will cover damage to another person’s car along with compensation for anyone injured but not for yourself or your own vehicle if the accident is your fault.
It may seem logical that the minimum level of cover will come at a minimum cost, but this isn’t always the case. High-risk drivers tend to opt for the lowest price cover so as a result, this has driven the price of third party-only cover-up. It’s wise to do as much research as possible to find the best price for the best level of cover. For many, fully-comprehensive cover can end up costing the same or even less than a third-party cover and it comes with the bonus that if you are in an accident – your vehicle will be covered if it is damaged.
3. Young drivers should get insurance in their parents’ name
This is illegal and should not be recommended to anyone to use as a cheaper alternative. Putting insurance in someone else’s name, even if it is a parent, is known as ‘fronting’ and can result in your policy being invalid.
Although this may seem like a good idea, it goes against the law. In some cases, you could end up being fined up to £5,000 if taken to court. Other consequences include disqualification, penalty points on your license, and struggling to find insurance in the future.
4. Parking your car in the garage is cheaper
A safe space to park your car may seem like it would reduce your insurance policy but again, this is not always the case.
In the eyes of the insurer, this could be deemed riskier than the driveway. Manoeuvring in and out of a garage potentially increases the chance of bumping your vehicle.
This is all based on statistics and how many claims are made because of this reason. For example, if the area you’re in has seen an increase in claims made because of garage-related accidents then this could impact your price. It is worth comparing quotes for driveway and garage parking if you have both options, and work out which is more convenient.
5. Once you reach 25, your premiums are less
Insurance for young and first-time drivers can be expensive, but this doesn’t miraculously disappear at age 25.
Insurance is circumstantial so it will always depend on the situation the individual is in at the time. For example, what car they are driving, and if they have had any claims or any changes made to the policy.
If you have claims against your name or driving penalties then naturally your insurance is going to go up, no matter what age you are.
However, it is worth noting that premiums do fall each year for younger drivers who manage to register no claims, but insurers do have a maximum no-claims bonus so eventually, this discount will retire.
6. You won’t have to pay the excess if the accident wasn’t your fault
Unfortunately, the truth is that if your car is hit by an uninsured driver or falls victim to a hit-and-run incident, you will still be required to pay the excess. This also applies if you find your car damaged in a car park.
However, if a car bumps into you and it wasn’t your fault, and you can then prove this to your insurer, they might waive the excess fee. In this case, it can claim the costs from the third party, but you may be required to pay it initially and then receive a refund. It is recommended to select an insurance policy in which you can afford the excess cost in case this happens.
7. I don’t need car insurance for a short journey
No matter how short the journey is, you must be insured. Under no circumstance can you drive on the road without insurance.
The only time you can have an uninsured vehicle is if you have a statutory off-road notification (SORN) which must be applied for via the DVLA. This will mean that your car is not going to be used on the roads at all.
You can only declare your car off-road if it is being kept on private property, for example, in a garage or on a private driveway. If the vehicle is being kept on the road, then you must still have insurance.