subject: Why You Might Buy No Frills Car Insurance [print this page] Why You Might Buy No Frills Car Insurance
For some drivers, car insurance is about getting the best cover possible so that if anything should go wrong, they won't be left high and dry. For others though, it is just seen as a legal obligation and little more. In this instance a car owner will often go for the cheapest, no frills insurance option available.
As with all low cost options there are pros and cons associated with no frills car insurance. For instance, there's no point in only getting third party cover if you have a 45,000 pound executive saloon. If it is damaged, stolen or destroyed it will probably not be covered and therefore you would be entirely liable for the costs involved in repairing or replacing it. This will invariably leave you out of pocket.
However, if you are a young driver and have been priced out of getting more comprehensive car insurance, the no frills third party policy might be your only option.
Unfortunately for new and young drivers, they don't have the history to prove their driving abilities. And, thanks to their peers, they are also in the highest risk category of drivers. Therefore, before they've even tried to contact an insurance provider, they will already be at a huge disadvantage.
This high risk factor also accounts for drivers who have lost their no claims bonus due to a crash or other incident. When you make a claim your liability immediately increases and insurers will be less willing to provide cover, certainly not at the rates that you enjoyed before. In instances where your premium has had a 50%+ increase, it might become difficult to justify a higher level of coverage - at least not until you have rebuilt your no claims bonus.
In the same way that you wouldn't want to buy third party insurance for a very expensive car, you also might not want to get comprehensive cover for a cheap run around. Let's say for example you've bought an 800 pound car to get from A to B. Having a 500 pound annual insurance policy would be a little counterproductive - particularly as you're unlikely to see any return on either investment.
The point of third party insurance is simply to allow you to drive legally - and that is pretty much it. It will cover you in the event of a collision with another car and will mean that you won't be liable for the damage cause - over and above your excess of course. Your car isn't covered however, so in the event of a crash, wanton vandalism or theft you won't receive a penny.
If you are involved in a collision that isn't your fault, you will be entitled to compensation for repairs from the party who was found to be the cause - so long as they have insurance. Therefore, as long as you don't get bumped into by somebody who is uninsured and are confident in your own driving abilities (at least enough that you won't cause a collision) third party is a decent solution.
It is a cheap and cheerful solution to insurance and one that millions of motorists choose each year. Whilst the coverage is minimal, it is at least legal and will make sure that avoid the wrath of the law.
Obviously no frills insurance won't suit all vehicles or drivers. It is mainly targeted at those who are young and therefore might be priced out of comprehensive cover, or cars which perhaps don't have a massive intrinsic value and therefore aren't worth insuring for more. Essentially it is a great option for anybody who has found the cost of other insurance policies prohibitive.
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