When choosing your motor insurance policy a number of different factors will determine the level of cover and the price you pay. However when an accident happens many motorists can find themselves in a minefield of confusing terminology. Tony McKeown, Marketing Director says its important to know the basics.
Third party only is the minimum cover that can be purchased. It protects the innocent parties in an accident. It covers third party death/injury and third party property damage. This is suitable only for vehicles of a low value (under £1,000).
This is the same as Third Party but includes coverage for theft of a vehicle and any loss caused by fire. The fire and theft car insurance limit is the market value of the car. This is suitable only for vehicles of a low value (under £5,000).
‘Fully comprehensive’ is a misleading term in insurance. There are always certain exclusions to what a policy covers and it will include excesses. In general ‘fully comp’ covers the same as TPF&T as well as any accidental damage including malicious damage and windscreen damage. It may include personal accident cover and cover when driving another vehicle.
A policy excess determines the contribution that you will make to any claim. You will pay this to the insurer before they pay the remainder. You can choose to pay higher excesses in order to reduce your initial premium. This will increase the cost of any later claim.
A No Claims Bonus (NCB) is a discount given by an insurer to policyholders who do not claim on their policy. The NCB increases annually and reduces the cost of your premium. The NCB is earned by an individual, not a vehicle, and cannot be transferred to another person. During a ‘Non fault’ claim your NCB may temporarily be affected depending on the individual policy. On the successful completion of the claim, your no claims bonus is re-instated.