The Road Traffic Act requires
all motorists to be insured against their liability for injuries
to others (including passengers) and for damage to other peopleŐs
property resulting from use of a vehicle on a road. It is
an offence to drive your car or allow others to drive it without
How Premiums are Calculated
Factors taken into account in costing your insurance include
who will drive, the type of car, where it is kept, the uses
to which it is put, and the type of cover required.
When buying motor insurance you must give the insurer full
The policy may only cover driving by yourself or specified
people, or it may allow driving by any qualified person with
your permission, possibly over a certain age limit. Your insurers
will want to know about anyone who is likely to drive - particularly
their age, experience, driving record and occupation.
Family cars with moderate repair costs are cheaper to insure
than large or powerful cars which can be expensive to repair.
Each model is given an insurance group rating. This system
is described later in this Information Sheet.
Older cars often attract discounts from comprehensive insurance
Insurance claims are more frequent in urban areas so motorists
in cities usually pay more for their insurance than those
who live in the country. The place where the car is kept is
a rating factor, so tell your insurers if the car is not kept
at your home address.
Your policy and certificate set out the uses for which your
car is insured. For example, if you or any authorised driver
want to use your car in connection with work, make sure that
your policy covers this.
Driving Other Cars
Most policies cover the policyholder in person while driving
a car which belongs to someone else.
However, cover will be limited to third party only, even if
you have a comprehensive policy. Accidental damage to the
borrowed car will not be covered by your insurance.
Make sure you have the car owner's permission to drive it
and that they have arranged comprehensive insurance to cover
you as a driver under their policy. If they have done this,
then accidental damage claims to their car, while you are
driving, will be met by their policy.
Similarly, before letting someone else drive your car make
sure your policy does not have a restriction on who may drive
Drinking and Driving
Drink driving convictions are taken very seriously by insurers.
Convicted drivers returning to the roads may face difficulty
in obtaining insurance and will certainly have to pay premium
increases of at least 100%. The level of cover may be reduced
- for example from comprehensive down to third party fire
and theft. These higher premiums and cover restrictions can
well last for a number of years.
All motor insurers have agreed that if your passengers contribute
towards your running costs your insurance cover will not be
affected, as long as lifts are given in a vehicle seating
eight passengers or less. This agreement does not apply if
you make a profit from payments received or if carrying passengers
is your business.
Changing Your Car
You must tell your insurers if you change your car. A premium
adjustment may be necessary and you will probably need a new
No Claims Discount
Policyholders with a claim free (not blame free) record normally
qualify for a premium discount. Scales do vary but usually
range from 30% for one claim free year up to 60% or more after
four or five years.
"Protected Discount" policies are often available
for motorists with maximum discount. For an extra premium,
a number of claims are allowed without affecting the discount.
Typically two claims are allowed in a three to five year period.
All UK motor policies provide the minimum cover required by
law in other European Union countries or the minimum cover
required by UK law if that is greater. This cover does not
automatically include theft or damage to your car and it may
not completely cover your liability to other people.
If you tell your insurers in advance, they can extend your
UK level of cover to most holiday destinations.
Your insurers can also supply a Green Card. This is recognised
internationally as evidence that you have insurance which
meets local law.
The insurance position when motoring abroad is covered in
detail in the separate information sheet "Holiday Insurance
and Motoring Abroad".
Look After Your Car
All insurance policies require you to make sure your car is
in a roadworthy condition. If you don't, you may find that
your claim will not be paid.
From time to time vehicles may be subject to a manufacturer's
recall to address a possible safety concern. You should check
with your local dealer or vehicle manufacturer to see if your
vehicle may be affected.
Tell Your Insurer
You must tell your insurer of any changes in the details given
on your proposal form such as address, occupation, type of
car and motoring convictions including fixed penalties.
Remember - not only is it an offence under the Road Traffic
Act to make a false statement or withhold information for
the purposes of obtaining a certificate of motor insurance,
but it may also invalidate your policy.
Two thirds of private motorists have comprehensive insurance.
Most of the remainder choose third party fire and theft, with
a small proportion taking out more limited forms of cover.
1 Liability for injuries to other people, including
2 Liability for damage to other people's property.
3 Liability of passengers for accidents caused
4 Liability arising from the use of a caravan
or trailer, while attached to the car.
Third Party Fire and Theft
As previous plus
5 Fire or Theft - If your car is not normally
kept in a garage at night, theft cover may be excluded or
subject to special conditions. There may be an "excess"
- a part of the cost of the claim for which you are responsible
- following an incident of theft. If you are selling your
car make sure you receive proper payment before parting with
it. Your insurance policy will not cover your loss if your
car is taken from you by deception.
As above and previous plus
6 Accidental damage to your own car. There may
be an "excess" - part of the cost of the claim for
which you are responsible.
7 A personal accident benefit. Certain amounts
are paid in the event of the death or specific permanent disablement
of the policyholder - and sometimes his or her spouse or family
8 Medical expenses necessarily incurred, up
to a stated limit.
9 Loss of or damage to personal effects in the
car, up to a stated limit.
What to do When Making a Claim
After the accident get as much on the spot information as
possible. Get hold of the names and addresses of independent
witnesses before they lose interest and leave the scene. If
you have a video or camera in the car, get pictures before
vehicles and property are moved. Also, make a sketch plan
of the accident while the details are fresh in your mind.
Ask the other drivers involved
for their names and addresses and make a note of their
car registration numbers together with the make and model.
Ask for the name of their
insurers and also, if possible, their policy number or
If anyone is injured, produce
your certificate of insurance. If you cannot do this at
the scene you must produce it at a police station within
There may be injury to
people or animals or damage to vehicles or property. If
so, you are required to give your name and address, the
name and address of the owner of the car you are driving
and its registration number to anyone with reasonable
grounds for wanting them.
Tell your insurers about
any statement made at the scene by any of the parties.
Do not discuss whose fault it was. If you do, you could
create problems for you and your insurers in the handling
of your claim.
You must tell your insurers
as soon as possible - even if you don't intend to make
a claim. This is a condition of your policy.
Ask your insurers for an
accident report form. When completing the form include
as much information as you can.
To Get Your Car Repaired
If you have a comprehensive policy: Ask your insurance company
for advice. Take your car to a competent repairer and tell
your insurance company immediately. If your insurance company
recommends a garage then take your car there if possible.
This may avoid the need to get a separate estimate and could
speed up the repair considerably.
Many insurers' recommended repairers will be able to provide
you with a courtesy car whilst your vehicle is being repaired.
Unless your insurer has special arrangements, send a repairer's
estimate to them. They will check it and if it is agreed they
will authorise repairs subject to your completing a satisfactory
When you collect the car after repairs you will have to pay
the first part of the claim if you have an excess on your
policy. You pay this money direct to the garage, whether or
not you were to blame for the accident. Your insurers may
also ask you to pay a part of the cost of repairs if your
car is put into a better condition than before the accident.
If you are registered for VAT, pay any VAT due to the garage
and claim it back from Customs and Excise. If you are not
VAT registered your insurer will pay it.
The cost of repairs is your responsibility until your insurers
have agreed to pay. For your peace of mind, you may want to
obtain confirmation from your insurer that they accept liability
and will pay the cost of repair.
If you have chosen third
party fire and theft cover, your policy will not cover
accidental damage to your car. You therefore have to pay
the repair bill yourself or claim from the other driver
if he or she was legally liable for the damage.
Write to the other driver
saying that you intend to claim from him/her.
Say that you hold him/her
responsible and ask him/her to tell their insurers.
Write direct to their insurers,
if you have details, quoting the other driver's policy
or certificate number.
Send a repairer's estimate
as soon as possible - their insurers may well ask you
for additional estimates.
Tell your own insurers
that you are claiming against the third party.
The other driver should tell their own insurer of the accident.
They will only be able to deal with your claim if the other
driver asks them to. They can only act on the instructions
of their own policyholder.
On receipt of your letter the third party may settle your
claim themselves or may pass the matter to their insurers.
If they consider their policyholder entirely to blame they
will pay your claim provided they have full information. If
they consider that you were entirely or partly to blame they
may refuse your claim or suggest a compromise.
The third party may refuse to co-operate at all in which case
you should seek advice from your insurance company, insurance
adviser, motoring organisation or solicitor. You may, at the
end of the day, have to take legal action against the other
driver; your policy may have a legal expenses section which
will cover your costs.
If Your Car is Stolen
Tell the police immediately then tell your insurer and ask
for a claim form.
Be prepared to wait a while in case your car is recovered.
A great many cars taken without the owner's consent are soon
If property is stolen from your car tell the police immediately
and then tell your insurer.
Most comprehensive policies protect you against loss of or
damage to rugs, clothing and personal belongings which are
in your car. Policies set a limit on the value of such property.
Check your own policy for details. See back page for advice
on beating the car thief.
No Claims Discount
The discount is usually reduced by two steps after a claim.
Whenever a claim is made under a motor policy, the discount
will always be affected unless your insurance company can
recover its costs from another party.
If your insurer can make a full recovery or is only stopped
from doing so by a knock-for-knock agreement, your no claim
discount may not be affected.
Similarly, if you recover all your uninsured losses (such
as accidental damage excess) then your discount may not be
Sometimes your no claim discount will be reduced at policy
renewal time if a claim is expected to come in, or is still
waiting to be settled. The discount may be reinstated if your
insurer subsequently doesnŐt have to pay out under the policy.
Many insurance companies have lists of approved repairers.
When you tell your insurance company about the accident ask
them for the name and address of the nearest recommended repairer.
You are not obliged to use a repairer recommended by your
insurance company although this will speed up handling of
your claim and you may not need to obtain a repairer's estimate
at all. Many insurers have arrangements with their recommended
repairers whereby you may be able to use a courtesy or hire
car free of charge whilst repairs are carried out.
Similarly, many insurers have arrangements with specialist
windscreen replacement companies. Keep a note of these in
the glove box of your car.
The Group Rating System
Insurance companies put car models into twenty groups. This
means that each model of car can be accurately banded with
cars of similar characteristics.
There can be a significant spread of groups within a particular
How the System Works
Nearly three quarters of all money paid out in motor insurance
claims goes on repairing cars. The cost of spare parts and
the times taken by repairers are therefore major factors in
pricing motor insurance.
The factors used to calculate group ratings are:
Damage and Parts Costs
The likely extent of damage to each car model and the
cost of the parts involved in its repair. The lower these
costs, the more likelihood there is of a lower group rating.
Longer repair times mean higher costs and the greater
likelihood of a higher group rating. Different paint finishes
on modern cars are an important factor. These, too, are
taken into account.
New Car Values
The prices of new cars identify the higher specification
models within a model range.
The availability of body shells (the basic frame of the
car) is taken into account in group ratings because they
are essential for certain accidental damage repairs.
Acceleration and top speed are important factors. Insurance
companies know very well, from their claims statistics,
that high performance cars often result in more frequent
Security features fitted as standard equipment by motor
manufacturers can help to reduce insurance claims costs.
Such features include high security door locks, alarm/immobilisation
systems, glass etching, coded audio equipment, locking
devices for alloy wheels and visible VIN numbers.
Recommended Group Ratings
The group ratings determined by the Association of British
Insurers are recommendations only. Individual insurance companies,
depending on their own experience, may vary from these recommendations.
Buying a Car
Motorists planning to buy a new car should check, in motoring
magazines, the insurance group rating of the exact model they
have in mind. The higher the group number the more will be
How to Beat the Car Thief
The financial loss of a stolen car is bad enough and although
insurance will compensate for this, nothing can help with
the shock and inconvenience.
Walk around any car park. You'll see cars with windows open,
ignition keys in the lock, sun roofs open, valuable property
and clothing on display on the rear seat.
Be sensible. Follow the checklist below every time you leave
Take Care of Your Property
Remember - if you are careless when leaving your car then
your claim for theft may not be paid at all. Your insurance
policy requires you to take care of your property at all times.
Have all the windows etched with the registration number of
your car. This deters car thieves.
Many insurers allow a special premium discount if your car
has a professionally-fitted alarm/ immobiliser system. The
Motor Insurance Repair Research Centre checks on vehicle security
devices to see if they comply with the criteria of the Insurance
Industry Vehicle Security Scheme. The list of those products
that have passed is used by insurers as a basis for premium
discounts and required security. Ask your insurer what systems
they approve or require. They may also require the system
to be fitted by a member of the independent Vehicle Security
Installation Board. Your insurer can advise you about this.
Where to leave your car
At night, park in a well-lit place. Thieves like working
in shadows. In a ticket-exit car park, take the ticket
Remove Car Ownership Information
Don't leave your certificate of insurance and registration
document in the car.
Leave property in a locked boot. In a hatchback the rear
shelf should be in position. In an estate car cover up
property with a sheet or blanket.
Remove the Ignition Key
Don't leave the key in the ignition - not even for just
a few seconds to go into your home, a shop or pay for
Close All Windows
When you leave the car, close windows. Don't forget the
Use an Anti-Theft Device
Thieves are opportunists. They will probably move on to
a car without a device fitted.
Always Lock Doors and Boot/Tailgate
Even when the car is in your own drive or garage, lock
it and take the keys with you.
Children and Animals
Never leave young children or animals alone in a parked
car. With windows or sun roof open you run the risk of
theft. With windows closed there is a grave danger of