Which car insurance is best? Everything you need to know

In the UK, you’re legally required to have some form of car insurance if you own and drive a vehicle. However, there’s a wide range of providers and an even bigger variety of policies to choose from.

In this blog, we’ll answer some key car insurance questions to help you better understand your options.

Does car insurance cover theft?

The lowest level of car insurance that meets minimum legal requirements is third-party only. This will cover any damage or injury caused to others, but will not cover you or your own vehicle. Third-party only insurance policies do not cover your vehicle against theft.

The next step up from third-party only is third-party, fire and theft. As suggested in the name, these policies will compensate you if someone steals your car or if it's damaged by fire. The highest level of coverage is fully comprehensive. Fully comprehensive covers everything included in the lower levels as well as injury and damage to you or your vehicle.

As standard, most car insurance policies won’t cover you against theft of any belongings that may be inside the vehicle. Some insurers offer add-ons for this purpose. It's often called personal belongings cover, possessions cover or even handbag cover.

Does car insurance cover repairs?

Third-party only insurance policies will not cover any repairs for your own vehicle. The next level up may cover repairs to your vehicle due to fire damage, but not for a road accident.

Fully comprehensive policies will cover your vehicle for some repairs. This includes damage due to road collisions, whether you were at fault or not. This can also cover repair costs due to damage by animals, natural disasters and objects falling onto your vehicle. Always check the policy details for any exclusions.

Most car insurance policies will not cover the cost of repairing a mechanical breakdown. However, some insurers offer a policy add-on to cover repairs to mechanical parts. If the manufacturer’s warranty on your vehicle has run out, you can choose to purchase an extended car warranty. It’s important to note that purchasing breakdown cover will not always cover the cost of mechanical repairs. Most breakdown policies will only cover repairs made by the breakdown mechanic at the scene, not any further work required.

When claiming on your policy for repairs it’s important to consider your excess. A policy will have a compulsory excess set by the insurer. Plus a voluntary excess chosen by you. The total of both must be paid if you choose to make a claim. If the cost of repairs is less than your excess, you might decide not to make a claim. Even if the repairs cost is slightly higher than your excess, it may still be worth covering the repairs yourself. You may lose your no claims discount (NCD) by making a claim. When it comes to renewing your insurance, a lack of NCD can increase the cost of the new policy.

Does car insurance automatically renew?

Most car insurance policies will be set to automatically renew at the end of its term. You can opt out of this by contacting the insurer. It may seem easier to let your policy auto-renew, but you may not be getting the best price. It’s worth shopping around before renewing your car insurance policy to check what prices other providers are offering.

Although a low-cost premium is desirable, it’s important that the insurer is reputable too. Always check customer reviews before taking out a new policy. You can find out how satisfied existing customers are with their policies and the service they’ve received from the provider.

Can car insurance be cancelled?

You can choose to cancel your car insurance at any time. This may be due to selling the insured vehicle, or perhaps you aren’t happy with your current policy or provider. Most policies have a 14-day cooling off period. Within this period you can often cancel and receive a full refund, but some providers charge an admin fee.

After the cooling off period, you’re still able to cancel your policy. If you’ve paid your premium upfront, a refund will usually be calculated on a pro-rata basis. For example, if you’re six months into a year-long policy, you should be refunded for the remaining six months. Any cancellation or admin fees set by the provider will be automatically taken from the refund total. If you pay monthly for your insurance, you’re unlikely to receive a refund. Instead, you may need to pay an extra amount to cover the time you’ve been insured. Again, you will need to pay any cancellation or admin fees if the insurer requires them. Optional add-ons usually cannot be refunded.

An insurer can cancel your policy if you’re deemed to have broken the rules or terms of the policy. This is usually due to missing multiple payments. This could also be due to non-disclosure of aspects of your driving history, or fraud. You’re unlikely to receive a refund if the provider has cancelled your policy. It can also be more difficult to insure yourself in the future, even with a different provider.

What is the best car insurance?

The best car insurance for you will depend on your needs. When searching for a policy, make sure you understand everything that is and isn’t included. Explore the range of add-ons that the provider offers if you wish to make your policy more secure. Finally, be confident in the provider by reading customer reviews before committing to a new policy.