In most countries, it is illegal to drive without car insurance. Driving without insurance attracts penalties and you could even end up losing your car. However, this should not be the key reason you buy car insurance. Having coverage is essential because it will give you peace of mind while on the road knowing that in case of an accident or any other bad incident, the damages will be paid for. But do all insurance companies offer the same package? Do you get the same protection with any cover?
If it’s your first time shopping for car insurance, note that not all packages offer the same protection. The two key options you will come across when shopping include comprehensive car insurance and third-party car insurance. Below are some pointers on what each covers and the cost differences.
Cost of Damage to Another Motorist
The key similarity between third party car insurance and comprehensive car insurance is that both will pay for the cost of damage to another motorist’s vehicle. Thus, if you are involved in an accident, and you are the at-fault driver, your insurance company will pay the other motorist regardless of whether you have third-party or comprehensive insurance. Third-party is the bare minimum that car owners are expected to have in most countries.
Cost of Damage to Your Own Vehicle
If you have third-party and your car is damaged, you will have to cover the cost of repairs yourself. With comprehensive insurance on the other hand, your insurer will pay for the cost of damage to both your vehicle and the other motorist’s vehicle. The same is the case when your car is damaged by fire, storms and other natural events. So, comprehensive pays out, but for third-party, you cover all the costs from your pocket.
In cases where you are involved in an accident, and the at-fault driver is uninsured, your car insurance company can pay for your damages if you have comprehensive insurance. This is not the case with third-party. Comprehensive insurance can also cover the cost of legal fees, broken windows, lost keys and also the cost of buying a new car in case of a write-off or car theft.
Insurance Costs
Since third-party doesn’t cover a lot of things, it tends to be cheaper than comprehensive insurance. However, as you look at the cost-saving benefit, make sure you are ready to pay for any other cost that extends beyond the third-party damage. Also, whether you go for third party insurance or comprehensive, shopping around can help in cutting costs. Consider making use of sites such as Quotezone.co.uk that offer free comparison services for third party insurance. This is a price comparison platform for different types of financial services products including insurance and utilities.
For the third-party cover, you can choose to upgrade to third-party, fire, and theft so that you don’t remain at the bare minimum and risk covering huge costs when accidents or other bad incidents happen. For the comprehensive, note that packages will differ. For instance, not all packages will include coverage for lost car keys. You have to read through the fine print carefully and request any add-ons if you feel something essential is missing.