Clearing Up Common Car Insurance Myths
The process of finding and securing the perfect car insurance can be complicated and at times stressful. Which is the best policy for you? What is included in your cover? How to go about getting the best price? What about renewals and third party and claims? The list is long and it can be a minefield. The process is not helped by certain car insurance myths that only serve to confuse us all further. We’ve included a few below so that you can set yourself straight for the next time you’re in the process of securing your car insurance policy.
First thing to bear in mind, and the golden rule in almost every example here is that nothing is universal. What happens in one policy does not happen in all so take a moment to check the policy you’re considering for full details. There are no hard and fast rules between insurance providers and its key that you consider each policy individually.
Car Insurance Myths
My policy will be cheaper if…..
My mileage is low
Low mileage does not always mean your policy payment will also be lower. This depends entirely on the driver and other factors. Some will be assessed as being high risk despite low mileage since driving less could indicate being less confident behind the wheel and may lead to a higher risk of accident.
I pay monthly
Policy payments are almost always more expensive if paid over a month to month schedule. One upfront payment will end up being cheaper since monthly payments normally incur an initial deposit amount as well as an interest amount paid on top of the basic monthly payment. If it’s interest free, it will say so. If not, you’ll be paying a little more for the convenience of spreading the cost.
I renew automatically with my provider
We would all hope our provider will reward loyalty with a cheaper policy renewal but unfortunately that is not always the case. Often ‘new’ policy applicants may find a better deal than current policy holders so it’s worth getting your Insurance Broker to compare providers and see what they can offer you each time you are due for a renewal.
I don’t use my car for business purposes
It’s often assumed that policies to cover driving for business will be higher than those that cover general social or community driving. This can be the case depending on the nature of work involved (long distance lorry driving for example), however many providers acknowledge that individuals driving for business often take better care of their vehicles and are more cautious drivers. They statistically have fewer accidents and claims and therefore may benefit from lower policy payments. The key here is to be honest when applying for a new policy. If you don’t declare business usage, your policy may not pay out in the event of a claim: a much bigger cost in the long run.
I only take out Third Party Cover
A myth that we’ve all heard and perhaps bought into, Third Party cover surely is cheaper than taking out comprehensive car insurance? Yes, that can be the case, but increasingly, it is not. Insurance providers are recognising that more high risk drivers are now signing up to Third Party Cover and due to a linked increase in claims, policy amounts can often be higher than fully comprehensive cover: do your homework.
I don’t make a claim
If you continue for years with no claims, surely your insurance policy costs will go down each year? Ideally yes, there are definite benefits to having a no claims bonus, but in practice, there are other external factors that affect premium costs. Most insurance providers operate a maximum no claims bonus period and economic factors as well as your age and location can impact your policy cost significantly.
My car is kept in the garage
It makes sense to assume that if we keep our car in the garage, our insurance premiums would be lower, safe and secure should mean less risk? Sadly this doesn’t hold in every instance. Depending on your location and the statistics showing thefts and damage in your area whether on the street or in your garage, you may find this does not make your policy less expensive at all.
My insurance provider will….
Always offer me a courtesy car in the event of an accident
That would be lovely, but do check your policy to be sure. In most instances, a courtesy car can be provided if one is available and if your car is repairable. But be aware that if your car is written off or has been stolen, that may not be the case.
Cover my claim if I caused the accident
This one is very important. Your claim may be covered if you caused the accident but this is not always the case. If you are convicted of drink driving or dangerous driving, it’s possible that your claim will be turned down.
Cover me for driving any car if I have comprehensive cover
It’s very commonly believed that a comprehensive policy covers you for driving any car but increasingly this is not the case for insurance policies. Check the letter of yours before you drive a vehicle other than your own.