Types of car insurance – which is best for you?

There are three types of car insurance drivers can choose from. A valid car insurance policy is a legal requirement in the UK, so you must abide by insurance cover laws. If you’re buying your first car or you simply want to brush up on your insurance cover knowledge, read our detailed guide below on the different types of car insurance available and which is best for you.

What are the different types of car insurance?

There are three main types of car insurance coverage available. They are third-party, third-party fire and theft, and fully comprehensive. Explore each in more detail below. 

Third-Party Car Insurance. 

Third-party insurance is the minimum legal level of coverage you can get, and it offers the least amount of protection. Should you be involved in a car accident or your car is stolen, third-party cover will only really pay out for damage done to another vehicle. It covers injuries you’ve caused to others, damage to other’s property or vehicle and any injuries your passengers sustain. This means injuries to yourself or accidental damage to your car won’t be covered. 

You may think due to the low level third-party insurance will be the cheapest but this isn’t always true. It’s risky to only take out third part insurance because you’ll not be covered for any personal damage or injuries. 

Third-Party, Fire, and Theft. 

Third-party fire and theft car insurance does what it says on the tin. You get the same coverage as third-party car insurance but with the added protection of fire and theft. You’re covered for fire damage, theft, injury to passengers and others, and also damage to someone else’s car.

You won’t be covered for damage to your car, theft caused by careless behaviour, accidental damage or your own injuries. 

Fully Comprehensive Car Insurance. 

Fully comprehensive car insurance gives you the highest level of coverage for you and your vehicle. It can be the most expensive insurance cover but it can save you money in the long run, should you be involved in an incident or accident. 

Comprehensive insurance covers everything involved in third party, fire and theft insurance, including damage to other peoples vehicles and injuries caused to others, but the main difference is you’ll also be covered too. Comprehensive insurance covers the cost of accidental damage to your vehicle (even if it was your fault) and the cost of replacement if your car is stolen. 

Which type of car insurance do I need?

The type of car insurance you need will depend on what you want from your cover. There’s nothing wrong with choosing the cheapest insurance policy but you may not get the kind of cover you need. Comparing car insurance quotes online can help you get an idea of what you can afford and what you can get for your money.

The most popular car insurance policy is comprehensive cover because you get the highest level of protection. In most cases, a fully comprehensive deal can also be one of the most cost-effective options too. Bear in mind, your car insurance quotes will be influenced by your individual circumstances so you may not be offered the same deal as others.

Are there other types of car insurance?

You may also want to look into other forms of car insurance which are tailored to specific drivers. 

Black Box Insurance. 

Black Box car insurance is a popular policy amongst first-time drivers and young people. Sometimes known as telematics insurance, this type of policy involves having a ‘black box’ fitted to your vehicle. The box sends telematic information back to the insurance provider about your driving and sets your policy accordingly. Information about your driving such as speed, cornering, time of day, braking and acceleration.

Find out more about the pros and cons of black box insurance.

GAP Insurance. 

Guaranteed Asset Protection or GAP insurance is a policy which is designed to cover the cost of your car if it’s written off. Having GAP insurance isn’t enough on its own though and you will also need one of the types of car insurance listed above too. GAP insurance can be a good option for those who have financed a car, bought a car which depreciates quickly or you’ve bought a new car with negative equity.

Find out more about GAP insurance and how it works.

Electric Car Insurance. 

Electric car insurance has all the legal level of cover you need to drive a car in the UK but with additional protection for your EV. This type of insurance can also cover things like batteries and charging cables which are specific to electric and hybrid cars. 

Classic Car Insurance. 

Classic cars aren’t usually driven like normal cars, and they may be saved for those special journeys or road trips. Classic car owners tend to drive their cars less, so classic car insurance policies can be cheaper than other options.

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