The basics of Auto insurance

So why do I need insurance? In the UK it is an offence under the Road Traffic Act to not have insurance. Insurance will, at a minimum cover you against injuries to others and damage to other peoples property. Don't forget that includes your passengers as well.So what types of insurance are there?In the UK, there are three levels of car insurance. Third Party insurance, Third Party, Fire and Theft insurance and Fully comprehensive insurance. It used to be that getting a lower level of insurance saved you a lot of money in premiums, that is no longer the case. Nowadays it probably isn't worth getting insurance cover less that fully comp. This insurance covers all of the other two plus Accidental Damage insurance, Personal Injury insurance, Medical insurance and Personal effects insurance.Tell me about NCDNCD, or No Claims Discount is a method of rewarding drivers who don't claim in a given year. They get a percentage off of the Insurance renewal. This typically rises to 65 discount after about 6 years and is well worth getting. With many insurance policies, you can opt for NCD Protection for a small charge. This means that if you have to claim against your insurance once or maybe twice in a year, you retain your NCD. This is particularly worthwile once you are on a high level of NCD.So how do Insurers decide what I have to pay? This depends on many factors including your age, the type of vehicle, where you live, what the vehicle is used for and of course how much NCD you have. If you are lucky to live in a 'good' area, your insurance will tend to be lower because of less theft. If you are young witha powerful car, your insurance will be higher. It is worth getting some quotes before you purchase a car, just in case the insurance is too high for you.What is an 'excess'?You can lower your insurance premiums if you agree to having an excess. This means that in the event of an insurance claim, you would agree to fund the first £100 for example yourself. Also known as voluntary excesses, they can range up to £1000 and significantly lower your insurance premium.What if I need to drive another car, will my insurance cover me?Fully comp insurance usually covers you to drive any other vehicle if you have the owners permission. However, Cover will normally only be at the lowest level, i.e. it will only cover injuries and damage to 3rd parties. So if you jump in your friends Ferrari and smash it, he will not be pleased as your insurance will not payout for him... :-(So what happens if I have an accident?Firstly, don't panic and make sure that everyone is alright. The next thing to remember is to never admit liability - it is up to your insurance company and the insurance company of any other vehicle involved to decide upon. You should swap insurance details with other drivers, take the names and contact details of any witnesses, note the conditions, and road layout and positions of vehicles as this is all information your insurers will require.Accidents should be reported to the police within 24 hours if they do not attend the scene and of course you need to let your insurance company know.What is a write-off?When your insurance company is dealing with your claim, they will look at the cost of repairing your vehicle. If it is over about 50 of the value, many insurance companies consider it not worthwile repairing and will offer a write-off value. Basically they are buying your car off of you as is in full settlement. If you feel you can repair the car cheaply, perhaps yourself, you can buy the vehicle back off of the insurance company and may end up with cash in the pocket. However, cars that have been written off will have this marked against them at the DVLA forever and so will never be worth as much as equivalent cars.I need to know more about motor insuranceOk, well it is probably best to visit the Association of British Insurers for more detailed information.

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