Cheap Car Insurance ? Car insurance: The basics
Cheap Car Insurance ? Car insurance: The basics
At its most simple, car insurance covers you if your car is stolen or involved in a road accident. It also protects other road users if you cause damage to their vehicle or property.
The cost of insurance – your premium – is based on how much of a risk insurers perceive you to be. For example, if you are a youngster ready to hit the highway after just passing your test, or you have had more than a prang or two, you will pay more.
However, if you can prove you are not a risk by keeping accident-free and storing your car safely, you will pay much less.
How does car insurance work?
Excesses: What are they and how do they impact claims?
Not to be confused with living the high life during the festive period or a long afternoon at the local all-you-can-eat buffet, an excess – in the insurance sense – is the amount you pay towards any claims you make.
For example, if your excess is £250 and you have an accident that causes £1,000 worth of damage to your vehicle, you will pay £250 and the insurer will stump up the rest.
Be careful when deciding your excess. The larger the excess the cheaper the premium, but a large excess may leave you out of pocket if you need to claim.
Source: Moneysavingexpert.com
