About Motor Insurance Policies

Motor insurers usually issue three documents

• The Certificate of Insurance - this is evidence of insurance as required by the Road Traffic Act.
  
  
• A Cover Note - acts as a temporary policy and also as a temporary certificate of insurance for the purpose of the Road Traffic Act.
  
  
• The Policy Document - sets out in full the terms and conditions of your policy.

You should read you policy carefully - there is no small print or difficult language in modern insurance policy booklets. By law The Road Traffic Act requires all motorists to be insured against their liability for injuries to others (including passengers) and for damage to other peoples property resulting from use of a vehicle on a road. It is an offence to drive your car or allow others to drive it without insurance.

How Premiums are calculated

Factors taken into account in costing your insurance include who will drive, the type of car, where it is kept, the uses to which it is put, and type of cover required. When buying motor insurance you must give the full information.

Drivers

The policy may only cover driving by yourself or specified people, or it may allow driving by any qualified person with your permission, possibly over a certain age limit. Your insurers will want to know about anyone who is likely to drive - particularly their age, experience, driving record and occupation.

Your Car

Family cars with moderate repair costs are cheaper to insure than large or powerful cars which can be expensive to repair. Each model is given an insurance group rating. This system is described later. Older cars often attract discounts from comprehensive insurance premiums.

District

Insurance claims are more frequent in urban areas so motorists in cities usually pay more for their insurance than those who live in the country. The place where the car is kept is a rating factor, so tell you insurers if the car is not kept at your home address.

Use

Your policy and certificate set out the uses for which your car is insured. For example, if you or any authorised driver want to use your car in connection with work, make sure that your policy covers this.

Driving Other Cars

Some policies cover the policyholder in person while driving a car which belongs to someone else. However, cover will be limited to third party only, even if you have a comprehensive policy. Accidental damage to the borrowed car will not be covered by your insurance. Make sure that you have the car owners permission to drive it and that they have arranged comprehensive insurance to cover you as a driver under their policy. If they have done this, then accidental damage claims to their car, while you are driving, will be met by their policy. Similarly, before letting someone else drive your car make sure your policy does not have a restriction on who may drive it.

Drinking and Driving

Drink driving convictions are taken very seriously by insurers. Convicted drivers returning to the roads may face difficulty in obtaining insurance and will certainly have to pay premium increases of at least 100%. The level of cover may be reduced - for example from comprehensive down to third party fire and theft. These higher premiums and cover restrictions can well last for a number of years.

Giving Lifts

All motor insurers have agreed that if your passengers contribute towards your running costs your insurance cover will be effected, as long as lifts are given in a vehicle seating eight passengers or less. This agreement does not apply if you make a profit from payments received or if carrying passengers is your business.

Changing Your Car

You must tell your insurers if you change you car. A premium adjustment may be necessary and you will probably need a new certificate.

No Claims Discount

Policyholders with a claim free (not blame free) record normally qualify for a premium discount. Scales do vary but usually range from 30% for one claim free year up to 60% or more after four or five years. "Protected Discount" policies are often available for motorists with maximum discount. For an extra premium, a number of claims are allowed without effecting the discount. Typically two claims are allowed in a three to five year period.

Motoring Abroad

All UK motor policies provide the minimum cover required by law in other European Union countries or the minimum cover required by UK law if that is greater. This cover does not automatically include theft or damage to your car and it may not completely cover your liability to other people. If you tell your insurers in advance, they can extend your UK level of cover to most holiday destinations. Your insurers can also supply a Green Card. This is recognized internationally as evidence that you have insurance which meets local law.

Look After Your Car

All insurance policies require you to make sure your car is in a roadworthy condition. If you don't, you may find that your claim will not be paid. From time to time vehicles may be subject to a manufacturer's recall to address a possible safety concern. You should check with your local dealer or vehicle manufacturer to see if your vehicle may be effected.

Tell Your Insurer

You must tell your insurer of any changes in the details given on your proposal form such as address, occupation, type of car and motoring convictions including fixed penalties. Remember - not only is it an offense under the Road Traffic Act to make a false statement or withhold information for the purposes of obtaining a certificate of motor insurance, but it may also invalidate your policy.

Policy Cover

Two thirds of private motorists have comprehensive insurance. Most of the remainder choose third party fire and theft, with a small proportion taking out more limited forms of cover.

Third Party

This covers:-

1. Liability for injuries to other people, including passengers.
   
   
2. Liability for damage to other peoples property
   
   
3. Liability of passengers for accidents caused by them.
   
   
4. Liability arising from the use of a caravan or trailer, while attached to the car.

Third Party Fire and Theft

As previous plus:-

5. Fire or Theft - If your car is not normally kept in a garage at night, theft cover may be excluded or subject to special conditions. There may be an "excess" - a part of the cost of the claim for which you are responsible - following an accident or theft. If you are selling your car make sure you receive proper payment before parting with it. Your insurance policy will not cover your loss if your car is taken from you by deception.
   
   
6. Comprehensive - As above and previous plus accidental damage to your own car. There may be an "excess" - part of the cost of the claim for which you are responsible.
   
   
7. A personal accident benefit. Certain amounts are paid in the event of the death or specific permanent disablement of the policyholder - and sometimes his or her spouse or family member.
   
   
8. Medical expenses necessarily incurred, up to a stated limit.
   
   
9. Loss of or damage to personal effects in the car, up to a standard limit.
   

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