Money & Insurance > Guides

Car insurance from A to Z. All you need to know to get the best car insurance policy

Robin Bowman

Robin Bowman
Nov 15, 2017

A Spokesman Said put some of the questions we get asked the most about car insurance to market leader Direct Line. 

Not all insurers or insurance policies are the same, and in general you do get what you pay for.


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When buying a new policy, it’s important to ensure that it suits your needs.

Do your research when comparing policies and make sure you read the policy booklet when it arrives.

It could be the most valuable purchase you ever make.

Cheap car insurance may look good at first, but it could turn out to extremely costly when it comes to making a claim.

If your insurance is coming to an end, and you are thinking of renewing, or taking out a new policy, make sure you look carefully at what is included.

Don’t compare apples and oranges, pick the car insurance policy that best suits your needs, rather than relying on just the price.

Find the right car insurance policy for you (at the right price) by comparing deals online now


What are the key details to check when comparing insurance policies? 

The Excess - the amount you have to pay to make a claim on your policy will vary.  

Cover limits - check the amount you can claim for: 

* Contents
* Alternative transport (hire car etc)
* Accidental damage, theft and hire car

Additional charges:

* Instalment fees for paying monthly
* Renewal fees
* Cancellation fees
* Amendment fees

Added extras - and whether they’re included as standard, or as an add-on.

For more detail, read: Car insurance extras - are they worth it?


What should I expect at renewal time?

Here’s a breakdown of the key things to look out for when your policy comes up for renewal:

* An insurer should write to customers with their renewal date and new annual premium, plus the price they paid last year, with plenty of notice before their policy ends, regardless of whether they have chosen to renew their policy automatically or manually.

* Customers should be given clear information at each annual renewal about what is included in their policy and any changes in cover should be brought to their attention to enable them to make an informed decision about whether it suits their needs.

* If customers do have any queries regarding their cover or the premium quoted, insurers have teams in place to allow customers to discuss whether the cover still meets their needs.

* All insurance policies have a minimum 14-day cooling off period, during which you can cancel the policy for any reason. If you cancel, you should get a refund of any premiums you’ve paid, but the insurer is allowed to charge you for the days the policy has been in force, plus any administration fee. 


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Why is my insurance costing more?

While price is important, when it comes to buying or renewing your insurance policy, it is important to make sure you know what you are covered for.

If the worst should happen, you want to be able to concentrate on getting life back to normal instead of worrying about a potentially large bill. 

There are many reasons why your renewal may increase at renewal.

This could be anything from past claims, to changes in address or other personal circumstances and even things outside your control such as like local crime rates.

Insurers take a number of things into account when calculating the price of individual insurance policies.

These include details such as your age, occupation, address, past claims and many more. These are used to calculate the premium vs. the likelihood of you making a claim.

If you are a plumber, for example, you are likely to be travelling to multiple places of work, at sporadic times of day, often earlier in the morning and in the afternoon.

You are likely to leave your vehicle on a public road or building site and carry valuable tools in your vehicle.


I'm a young driver, why am I paying more for car insurance? 

Insurers are often asked why younger drivers face much higher premiums than the rest of the market.

Although many young drivers have relatively low cost vehicles, they are statistically much more likely to cause a serious accident.

In fact, young or newly qualified drivers make up a relatively small percentage of licence holders (12%) but are involved in a much larger percentage (20%) of road deaths and serious injuries.  

Here's how to cut the cost of teens' car insurance


What does an 'excess' mean?

An excess is the fixed amount that you will have to pay in the event of a claim.

There are two types of excesses, voluntary and compulsory.

Voluntary - this is agreed between you and your insurer when you take out a new policy. Increasing your voluntary excess may bring your premium down, but bear in mind that you will have to pay this if you make a claim

Compulsory - this is an excess applied to your policy by your insurer and often applies to more specific claims, such as; windscreen replacement in motor claims and flooding or subsidence in home claims

For example; If you make a claim for £1,000 and have a voluntary excess of £100 & a compulsory excess of £150, you would have to pay the first £250 of any claim.

You would then receive £750 from your insurer.

Note: if this is a non-fault claim, your excess may be able to be recouped from the party at fault.


What does a No Claims Discount mean?

Your No Claim Discount (NCD) is the reward an insurer gives you for not claiming on your insurance policy.

This often applies to both Motor and Home insurance and is one of a number of things taken into account when calculating the price of your policy.

In fact, insurers often provide a significant discount to customers with one or more claim free years.

It is important for customers to look at the price they are quoted overall, in addition to checking the cover suits their needs, rather than focussing on the levels of discounts offered from provider to provider.


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How can I protect my No Claims Discount?

No claim discounts are valuable because they reward safe driving.

However, even the safest drivers can be involved in accidents and, those who view their no claim discount as a hard-earned commodity won’t want to lose it through another’s bad driving, so it could be worth them paying to protect their no claim discount.

Customers should consider all the information provided to them and their individual circumstances before deciding to purchase protected NCD.

It should also be noted that ‘no claims discount protection’ does not protect the overall price of your insurance policy.

The price of your insurance policy may increase following an accident even if you were not at fault.

Note: Your no claims bonus discount can only be used on one vehicle at a time.

Whilst it can be transferred to an alternative car, it cannot be applied to an additional car or another vehicle. It is possible to build up multiple NCDs on vehicles insured under different policies.

A number of insurers will give discounts or allow you to mirror your NCD on a second car, but you need to check with individual insurers to find out if they offer such incentives.

When did you last switch your car insurance provider?

Last year 65% of customers didn't switch their car insurance to try and get a better deal.