If you own a car, no doubt you’ll understand when people sit around complaining about the monetary value of their automobile insurance. But, the fact is that the monetary value of you car insurance is going to depend as much on what type of car insurance you buy as it is on what car insurance firm you use to insure your vehicle.
So, what are the dissimilar types of car insurance options available?
Fully comprehensive car insurance
Fully comprehensive vehicle insurance is without doubt the most expensive. However, with so many vehicles financed by finance firm, it is also probably the most common type of insurance – as the finance company make it a requirement that the owner insure their auto fully comprehensive.
In short, as its name suggests, fully comprehensive vehicle insurance insures the owner of the vehicle against all manner of events – from an accident to theft of the motorcar. The upside of this type of automobile insurance is there is no need to show ‘fault’ in order to claim. So, if you have an fender bender, which is not your fault, and the owner of the other motorcar, who is at fault, doesn’t give you his vehicle insurance details, or, worse, is uninsured, you can still claim against your vehicle insurance group. Similarly, if your vehicle is stolen, then fully comprehensive car insurance allows you to claim against the insurance company.
However, do read your car insurance plan carefully, as most automobile insurance companys refuse to insure 100% of the value of a auto, choosing instead to only insure 80%, or so, of the value. The auto insurance groups claim that doing this prevents fraudulent losses of vehicle where the owner of the automobile either no longer wants the vehicle, or is encountering financial difficulty.
Third Party, Fire & Theft
Third party, fire & theft insurance is a middle of the road automobile insurance package popular with those who have already paid off their auto loans, but who still have a certain level of intrinsic value in their motorcar.
Under this type of car insurance, most of the pay-out events covered under fully comprehensive v are covered – such as fire & theft. However, in the event of an car accident, the car insurance company is only required to pay-out if you are at fault, and you hit another auto. So, in the event that you hit a wall, or only damage your motorcar, the vehicle insurance group will not be required to pay. Likewise, if you are involved in an car car crash with another car, and are not at fault, your car insurance organization will not be required to pay-out, regardless of whether or not the other person has sufficient auto insurance to pay for the damage done to your auto.
Third Party auto insurance
Third party automobile insurance is the ‘basic’ type of car insurance, and only covers circumstances where you are involved in a auto collision, are at fault, and hit a third party. In all other events, the insurance company is not required to make a payment. As such, it is also the cheapest type of automobile insurance you can purchase. That said, this type of automobile insurance is usually only purchased by those car owners who have an old motorcar with little or no value.
Specialized vehicle insurance
Finally, strictly speaking any vehicle over 25 years old is considered a ‘classic’. As such, this type of auto should be insured as a classic auto – with all of the benefits and requirements of such. Although ‘classic’ auto insurance usually has all of the benefits of fully comprehensive auto insurance, one significant disadvantage that classic vehicle insurance has is that you are usually limited to the number of road miles you can drive in any given year – so check your plan carefully.