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Which should I choose comprehensive or third party insurance?

Car Insurance

The cost of car insurance means it’s common sense to shop around and find the best-priced policy, with the level of cover you need.

It’s not all about the price though. The decision to choose a comprehensive policy, or third-party car insurance, can make a big difference if you ever need to make a claim.

Here is a handy guide to the main types of car insurance.


Purpose of your car insurance

When choosing between third-party and comprehensive car insurance, the important thing to keep in mind is the ‘risk’ you want to cover.

It’s easy to think that insurance is there simply to repair or replace your car if it’s damaged or stolen. In fact, car insurance varies in the protections and pay-outs it provides. Though it always includes vital cover for if you accidentally cause damage or injury to someone else or their property. They are known as a ‘third party’ (i.e. not you or your insurance company).


What is third party insurance?

By law, this is the minimum amount of insurance you can have when you own and drive any kind of vehicle.

You are paying to cover the risk that you may damage someone else’s car in an accident. Or, for any damage, you accidentally cause to a building, for instance.

Third party insurance will also payout if you hurt someone in an accident. That means you don’t have to find money to pay for the injured person’s medical bills or loss of income.

However, if you choose to only have third party insurance cover for your car, there are things that you personally could lose out on. Including claiming for the cost of your own vehicle repairs or replacement.

To illustrate how third party insurance works, what happens if you crash into someone’s garden wall? The policy would settle any claim made by the third party, including any medical bills if they were injured in the incident. Then, you would have to pay to mend your car yourself!


Third party, fire and theft policies

It’s possible to buy a different kind of third party car insurance policy, that gives you more chance of making a claim when something happens to your vehicle.

This is called a third party, fire and theft policy. It enables you to get the value of your vehicle back if it is stolen, as well as covering repairs such as new locks and windows if they are damaged as a result of someone trying to break into your car.

It could also cover getting your car sound system replaced, following theft from your vehicle.

In addition, you can claim on this type of car insurance policy if your vehicle is damaged by fire.


What is comprehensive car insurance?

As the name indicates, this sort of policy covers a lot more of what could go wrong when you own and drive a vehicle.

It includes all the cover outlined above. However, a comprehensive insurance product also fills some of the gaps in the ‘risk list’ mentioned so far.

With comprehensive car insurance, you protect yourself from a wide range of things that can happen to you or your vehicle.

Let’s look at another example of how this works. You park in a multistorey car park and return to find a big gouge in the side of your car and no sign of the driver responsible. With third party policies (both kinds) that repair bill is all yours! However, you can use a comprehensive car insurance policy to claim money towards restoring your car’s bodywork.

Just think what a big difference it would make if your car was a write-off, and you needed the comprehensive insurance pay-out to buy a replacement!


Which costs more, comprehensive or third party insurance?

The more risks a policy covers, the larger the potential claims settlements will be. Therefore, the higher the premium.

However, that doesn’t always mean that third party insurance is the cheaper option! If the policy includes a big sum pay-out for damage to another road user, pedestrian, or cyclist, it could be relatively expensive.

This makes it vital to get good advice on the best car insurance for you.

It’s important to consider though, that comprehensive car insurance is going to make claims for damage to you and your vehicle more successful, covering more everyday risks.

That kind of peace of mind is priceless!

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