What type of car insurance do I need?

Car insurance policies usually come in three types of flavours:

• Third Party Only
• Third Party Fire and Theft
• Fully comprehensive

Third Party Only (TPO)

Third party insurance is the bog standard and minimum type of insurance that can be taken out and is needed by law for all people who are driving on the road. Third party car insurance covers liability for the following but may vary from provider to provider:

• Injury to other people
• Damage caused to other peoples belongings
• Passengers travelling in the car that has the accident

This type of insurance is often the cheapest form of car insurance and will not cover the costs to your car and possessions in an event of an incident. If your car is worth less than some of the repairs it may need then this type of car insurance is for you otherwise you should consider a better type of insurance.

Third Party, Fire & Theft (TPF&T)

Third party, fire and theft is the next best type of cover and provides the same cover as Third party only (TPO) but with the addition of fire and theft of the car.  It is important to remember that if you are at fault of an incident then this type of cover will not finance the repairs to the vehicle.

Third Party, Fire & Theft is not the type of insurance for expensive cars and people that are on the road everyday. People who cannot afford Fully Comprehensive cover, which we will discuss later, usually young drivers and people with little no claim bonuses may find TPF&T the perfect solution.

Fully Comprehensive

Fully comprehensive is the best level of cover available and protects against the following but again may vary according to the provider:

• Damage to your car in an event of an accident
• Personal accident benefit
• Medical bills
• Injury to other people
• Damage caused to other peoples belongings
• Passengers travelling in the car that has the accident
• Drive another vehicle with your policy
• Free courtesy car in an event of an accident
• Legal help
• Protected no claims bonus

Fully comprehensive is usually suitable for cars that are worth over £1000 and cars which are over £5000 must be insured by this type of cover. 

Car Insurance Guide
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