There are very little countries in the world where car insurance is not obligatory. It can become complicated if you are not aware of certain aspects, so to understand exactly what your insurance provider is offering you, will help you to manage your vehicle proficiently.
What it essentially does, is provide you with cover so that you would not be left with an enormous bill to settle if you were involved in an accident. We all know how expensive it is to get proper panel beating done and to have bumpers and lights replaced is nearly as costly as the car itself.
Hence the different levels of cover which is available in the market today:
The minimum level of cover which is an obligation if you drive a car, is called Third Party Insurance. It means that only other people affected by an accident, like pedestrians, passengers in your car and occupants in the car which you collided with, as well as damage to property will be covered by your insurance policy.
Added to this policy, you could opt to have a Third Party, Fire and Theft cover. Here you will be protected in case of damage by fire, or damage by theft and outright theft as well.
The Comprehensive Car Insurance policy will basically cover everything in the above two levels, but now covers loss and damage to your own vehicle. It will also protect any personal belongings you had in the vehicle at the time of damage and will offer protection against windscreen replacement as well. Depending on the insurer, they will include various other areas of cover.
Of course there are a wide range of policies on offer today and the premiums will vary as certain aspects or influences will dictate what premium you will pay. So basically the higher their risk is, the more premium you will pay. Take for example things like what make and model vehicle you drive - here they look at book value, then they will consider if you live in a high risk zone where theft and break-ins of vehicles are prolific. Your age and driving history and claims history, will also come into play when calculating your premium
You might have heard people talking about a no-claims bonus and often wondered what this actually means. Well essentially it is a reward system which insurance providers have in place, provided you have made no claims whatsoever within a period of time stipulated by them. How they honor that bonus is up to each company, but many offer pay back schemes or lower premiums.
Important to a policy holder would be the amount of excess one has to pay when repair to ones car becomes necessary. Here companies might want a different amount per item. For instance, a certain amount will be stipulated for windscreen replacement, or panel beating. Ensure that you know what your excess is for various claims, so that you are not caught off guard when the time comes. In today’s fast pace life and tension on our roads, one cannot be without car insurance, it has become a necessity for all drivers.
Car insurance is legal in almost every country in the world, saving on car insurance on the other hand maybe more difficult. Because of the legalities of driving on public roads, an individual looking to buy a policy must therefore have a clear understanding of what it precisely entails.
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