Motor Insurance: 3 Main Policies

By: EconomyWatch   Date: 26 May 2010

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Motor insuranceis something you must have if you wish to operate a motor vehicle on any type of highway or road. Here we look at some important points worth knowing about.

There are three different kinds of insurance plans for operating a motor vehicle. They include:

•    Third party only
•    Third party fire and theft
•    Comprehensive

If you go with third party plan then as a driver you will be protected against liability in the event that damage occurs to a third party’s vehicle or property. This insurance policy also will be beneficial if an injury occurs to a third party.

The next kind of motor insurance is third party fire and theft. In this case you have third party coverage but you also have extra coverage in the event that your car is stolen or is damaged or destroyed by fire.

Comprehensive is the third type of insurance plan. As the name implies this is a comprehensive policy. It includes third party fire and theft as well as offering protection for any accidental damage that occurs to your car. It also offers liability towards any third party that is involved.

Insurance premiums can vary tremendously from one insurance provider to another. This is something that you must bear in mind when it comes to motor insurance (autoinsurance, motorinsurance). The kind of insurance you need plays a role in the decision making process. So does other things such as the make of an automobile, the model and the age of it. Never take the lazy route and select the first quote you come across because it sounds good. Shop around and do some checking before you apply for an insurance policy. It helps to get as many as three quotes. If you have time to get four or five then all the better for you! Doing this can save you a tremendous amount of money on premiums.

Other factors that can play a role in the premiums you pay for motor insurance (autoinsurance, motorinsurance) include your claims history, the number of years you have been driving, and whether your car is used for personal use and/or for business use.

If you have ever heard of a no-claims discount (NCD) then this is something you need to know about. A NCD is a discount offered by an insurance company for every year of “claim-free” or “accident-free” driving under the insured individual’s name. Most companies will offer their customers a 10 percent NCD every year if no claims are made. This is up to a maximum of 50 percent.


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