Different Types of Insurance Explained

In order to choose the right car insurance, it’s important to have a good idea of the different types available. Many drivers have discovered the hard way that they weren’t adequately covered when something goes wrong. Whether you’re looking for brand new cover, or you’re due for a renewal soon, here you’ll discover more about the different types you might want to consider.

What different types of car insurance are available?

When you’re looking for car insurance, you’ll discover there’s three main categories to choose from. However, there’s actually a fourth that isn’t widely advertised. So, the four types of insurance available include:

Comprehensive – Offers the best protection to drivers and covers practically everything. Even if you caused the accident somehow, this type of cover still protects you by paying for any damage to your car and yourself. Generally speaking, if your car is worth over £1,500, comprehensive cover is the best option.

Third party – It’s actually a legal requirement to have at least third party insurance. Many drivers also opt for this type of cover rather than comprehensive because they believe it’s the cheapest option. However, this isn’t always the case and surprisingly some types of third party cover can be more expensive, so it really pays to shop around. It typically covers your passengers, as well as the driver and passengers of any car you collide with.

Third Party with Fire and Theft – This type of cover includes everything standard third party insurance covers, only it also includes fire and theft. Many drivers are surprised to learn their insurance doesn’t cover fire and theft automatically. So, if this is something you are concerned about, you’ll want to ensure it’s added to your third party policy.

GAP – This type of insurance isn’t a legal requirement, but it can prove invaluable if your car gets written off. GAP insurance pays out the difference between what you are offered from the insurer and the amount you paid for the car when you first bought it. This ensures you can replace the car if required and you won’t have to worry about depreciation.

There’s actually numerous types of GAP insurance available, so like the other types of cover, it’s worth doing your research before choosing an insurer.

Overall, choosing the right type of cover is essential, particularly if you don’t have a huge budget available. Always compare the different insurers and remember that the same type of insurance can have many different variations.

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