Comprehensive car insurance: what is it, and do you need it?

There are three types of car insurance policy: comprehensive, third-party and third-party fire and theft.

Comprehensive gives you the most cover. It even pays out for your repairs if you have an accident that’s your fault.

Third-party or comprehensive car insurance: what’s the difference?

Third-party car insurance only covers you for the damage you cause to others. This includes:

• Injury to other people
• Damage to other cars
• Injuries to your passengers

Third-party insurance doesn't cover you if:

• Your car needs repairs after an accident you caused
• Your car is stolen or damaged
• You damage your windscreen
• You get injured while driving a car that’s not the one listed on your policy

Third-party fire and theft covers you for the same things, and also if your car is stolen or damaged by fire.

Comprehensive – also known as “fully comprehensive” or “fully comp” – covers you for the same things, plus:

• Damage caused to your car – even when it’s your fault
• Personal injury – even when it’s your fault
• Windscreen damage
• Write-offs

Different insurers throw in different features on top of this, too, like personal belongings cover, and cover while you’re driving abroad. It’s worth comparing them before you take out a policy.

You don’t need both comprehensive and third-party car insurance. Comprehensive covers the lot.

Comprehensive car insurance is usually cheaper

Despite covering you for everything, comprehensive car insurance tends to be the cheapest type of car insurance policy.

This wasn’t always the case, and in theory comprehensive car insurance should be the most expensive.

But because third party car insurance used to be the cheapest, many “high-risk” drivers would buy it to keep their driving costs as low as possible.

Those high-risk drivers, who tend to be younger, also tend to have more accidents, and this has driven up the price of third-party insurance.

But the difference in cost varies. For younger drivers, comprehensive insurance is likely to be much cheaper than third-party insurance, sometimes more than half the price.

Older drivers with third-party insurance don’t tend to have as many accidents, so the price difference is less marked.

But comprehensive is still likely to be cheaper than third-party insurance – especially given that third-party doesn’t pay out for damage to your car if you do have an accident.

Policy add-ons and comprehensive car insurance

Comprehensive car insurance covers you for all repairs and personal injury if you have an accident – whether that accident is your fault or not.

But that doesn’t mean every cost is taken care of. Many features and benefits are only included as “optional extras”, and they come at a price.

This varies between insurers. Some include these extras as standard, others charge a fee.

Here’s how the 20 top-rated car insurance providers on Smart Money People compare for breakdown cover and courtesy cars – features are which are sometimes, but often not, included as part of comprehensive car insurance.

Driving other cars with comprehensive car insurance

Comprehensive insurance doesn’t always mean you can drive other peoples’ cars. Each insurer has their own policy on this.

Some comprehensive insurance policies don’t cover it at all. You have to pay extra to have it added. Insurers that do let you drive other cars often have restrictions, such as:

• Age. Drivers younger than 25 are rarely covered to drive other peoples’ cars, even if they have fully comprehensive insurance. And once you turn 25, you’ll usually have to contact your insurer to add it to your policy.
• Occupation. If your job involves driving a number of different vehicles, your comprehensive insurance probably won’t cover you to drive other peoples’ cars.

Like many things with car insurance, it’s complicated. You need to read the small print on your policy to check what you can and can’t do.

You can get six points on your license for driving someone else’s car without the right insurance, so you make sure you get in touch with your insurance provider to find out in advance.

Driving abroad with comprehensive car insurance

All insurance policies cover you to drive in European countries. You don’t need to carry a green card to prove you have insurance. (This will change if there’s a no-deal Brexit.)

Not all car insurance policies give you comprehensive cover to drive in Europe. Even though you may have comprehensive cover in the UK, you might only get third-party cover while driving in Europe.

If not, you might be able to upgrade it. There will usually be a fee for this.

If you drive outside Europe, you need a green card, which is issued by your insurer. Your car insurance won’t be valid outside Europe if you don’t have a green card.

If you hire a car abroad, this might not be covered by your insurance policy. If it is, you will usually only have third-party insurance while driving the hire car, not the full comprehensive cover you have when driving your own car.

For fully comprehensive hire car insurance, you’ll usually have to pay a fee to the rental company before you pick up your hire car.

As with most things, the rules around using your car insurance abroad depend on your insurance and your specific policy. The important thing is to read the fine print and check that you’re covered before you go abroad.

If you’ve taken out comprehensive car insurance, review your insurance provider today.