UNBIASED INSURANCE ADVICE FROM MARTIN LEWIS
Car Insurance Policies Comprehensive in Name Only
Author: Christian Ward
Car insurers have started rewriting the English language. The dictionary definition of comprehensive is 'something that includes all or much'. But insurers have been gradually stripping out sections from their policies, leaving drivers with cover that is comprehensive in name only. Features that used to be standard in virtually all comprehensive car insurance, such as third-party liability cover for driving any vehicle, or an extension of cover for short trips overseas, are disappearing. Courtesy cars and recovery of any uninsured losses when you are at fault are becoming costly optional extras. Research conducted by the British Insurance Brokers' Association found alarming examples where comprehensive cover has been eroded. For example, Quinn Direct does not cover personal effects in the car. Insurance against damage to windscreens or other windows is available only as an optional extra. The 'comprehensive' policy sold by RAC does not allow a policyholder to drive any other car, while features such as a courtesy car and insurance overseas are optional extras. Hayley Parsons, chief executive of comparison site gocompare.com, says: 'The importance of comparison sites has meant it is key for insurers to get near the top of the rankings on price and they can do that by slimming down the cover.' Graeme Trudgill, technical services manager at Biba, says: 'All the advertising is about price. It's no longer focused on providing the right financial protection for the motorist. 'Even if an element of cover remains, the sum insured may be reduced. Many insurers have lowered the limits for loss of items from the car, for accidental damage to the windscreen or for personal accident cover. 'And in some cases, such as an accident involving a younger driver, the compulsory excess charged has increased.' Tesco, for example, makes customers pay the first £75 of any windscreen claim and levies a £350 compulsory excess for drivers aged between 21 and 24. This all means that motorists who want to be sure they are fully covered need to check the insurance small print carefully. Amanda Smith did her homework before signing up with specialist women's insurer Sheilas' Wheels for her Audi TT Cabriolet. Amanda, 33, a marketing manager, got the car new after a four-month wait and says: 'There is no way I would have anything less than fully comprehensive insurance.' She pays £380 a year for cover, which includes a protected no-claims discount and allows Amanda to drive other cars in an emergency. There is also a generous £1,000 allowance for loss or damage to the stereo and satnav. As well as full cover for the car, Sheilas' Wheels gives a £300 'handbag allowance' and £200 of cover for personal belongings if anything is stolen from the car. This delights Amanda, who lives on Anglesey in North Wales, with her partner Simon Leung. 'The cover for personal belongings is reassuring because you can easily end up carrying lots around with you,' she says. Trudgill says: 'Think about what features matter to you. Also, how much could you afford to pay in the event of a claim. You may find that paying slightly more than the cheapest premium actually gives you a better value option.' Speaking to a broker can also give a different perspective. Norwich Union, for example, has removed cover for driving other cars from the insurance it sells direct. But it retains this in policies issued through brokers. Loyalty falters as premiums soar Soaring insurance costs are the latest blow for hard-pressed motorists. Analysis by management consultant Deloitte shows that premiums have risen by 8.2 per cent in the past 12 months to £488 a year on average. Catherine Barton, insurance partner at Deloitte, says: 'This is the biggest annual rise in premiums we have seen in a long time. Insurers have been releasing money from reserves over the past few years to keep competitive, but this is drying up and premiums are having to rise.' The Deloitte figures suggest that premium inflation is accelerating. In April, AA Insurance reported a 5.8% annual rise in motor premiums. But motorists can fight against rising rates. Good deals are still available, especially for those with a clean driving record and big no-claims discounts. Ashton Berkhauer, head of insurance with comparison site uSwitch.com, says: 'The number of people shopping around and not accepting their insurers' renewal has increased. 'Typically, 80% of customers renew with an existing insurer, but we've seen that slip to 65% for some companies. 'Drivers are under increasing financial pressure and so they are becoming more price sensitive than ever before.'
Article Source: http://www.articlesbase.com/insurance-articles/car-insurance-policies-comprehensive-in-name-only-507019.html
About the Author:
Christian is an author of several articles pertaining to Car Insurance . He is known for his expertise on the subject and on other Business and Finance related articles.
With the economy in an ever worsening state, the coming year brings more importance than ever to compare car insurance. On average only one in three motorists compare car insurance online, so there really has never been a better time to make the move to online comparison websites.
Those who never compare car insurance , seem to be destined to lose money because surveys tell us that those consumers who don't are almost guaranteed to be paying over the odds for their policy.
With comparison websites thick all over the web it can often very very difficult to select a provider, and with so many promising to save you money online it really is a tricky call to make.
In this article we will be impartial and will attempt to offer you some tips on what to look for from a car insurance comparison website when you compare car insurance online.
1. The more the merrier.
Of course when you compare car insurance, one of the most important things you need to look for is how many car insurers and schemes do they search? The more they search, they more likely you are to save money. With more quotes to select from you also have better options when choosing the right policy for you!
2. What is their mark up?
Car insurance comparison websites are not charities so there are two ways in which they can make money from you:
(i) They will put a mark up on the price of the policy just like a retail store does when you buy something. These are the ones to avoid as they are most likely also gaining an incentive from the insurer as well for your business.
(ii) They will add nothing to the cost of the policy but simply be satisfied with what the insurer offers them as the incentive to sell their product online for them. These comparison website usually use the term 'cheaper than direct' which means the comparison website will reduce the cost of the policy below that of the insurer themselves but still take a small portion of the policy cost for themselves from the difference between the price they pay the insurer and the price you obtain the policy for. These guys are the Robin Hood's of car insurance and therefore deserve your business much more.
3. Read the small print
Always read the small print and terms and conditions because if you don't you could get stung, either before or at the time you try to claim on your policy.
4. Interest rates
Many consumers always go for the cheaper quote, but just like with ebay's shipping costs there is always a bigger picture. The interest rate is what the insurer adds on to the cost of your policy should you choose to pay in monthly instalments.
Some insurers charge a modest 12 per cent while others will try to disguise their massive 28 per cent interest rate inside three thousand lines of conditions, and with the typical consumer too trusting to even notice this, they are never any wiser.
While there are many cowboys out there, most car insurance companies tend to play it fair and luckily most of the major car insurance comparison websites need to be competitive to be successful.
So if you want to save every penny in 2009 and beat the credit crunch, then we hope you found the tips and inside information in this article helpful or at least interesting. More importantly, don't forget to compare car insurance , it may end up being the lifeline you need to survive the harsh times ahead.
Article Source: http://www.articlesbase.com/insurance-articles/compare-car-insurance-in-2009-to-beat-the-economy-700916.html
About the Author:Article written by the CompareCom Car Insurance Division, For more infomations please visit : http://www.comparecom.co.uk
Understanding Car Insurance No Claims Discount and Bonus By [http://ezinearticles.com/?expert=Dave_Healey]Dave Healey
Car Insurance No Claims Discount and Bonus Explained
If you are a young driver or an older new driver who has never purchased a car insurance policy before, you may well have heard of but not be aware of the meaning of the terms 'No Claims Discount' or 'No Claims Bonus'. Most certainly when you first take out car insurance it is highly unlikely that the concept of these discounts was not explained to you, as they are not applicable in the first year of a car insurance policy. Essentially the two terms are the same and mean that for every year of claims free driving you will receive a discount on the following year's car insurance premium. The discount is the amount as a percentage that will be allowed against the car insurance premium you pay, the Bonus concept of the number of years without claims expressed as an amount. The two terms are interchangeable as you may often see the expression NCD or NCB used throughout a car insurance policy key facts document.
Rewarding Good Driving with Cheap Car Insurance
The amount of the discount will vary from company to company and is usually larger in the first few years, possibly even thirty percent in year two, and decreases over each subsequent year up to a fixed number of years, usually five or six. When you have achieved five or six years of driving without having made a claim you are said to have accrued 'Maximum No claims Bonus'. Each and every Car Insurance Company will have a limit on the number of years it will allow you to build towards your maximum no claim period. The amount it will discount against the premium for someone who has maximum no claims is usually around sixty percent but with some specialised car insurers this can be higher, sometimes seventy percent or higher as these companies have a better 'risk pool' of similar drivers or vehicles covered, and though better knowledge of the market can adjust their rates accordingly.
Protect Your Good Driving Record
If you have managed to get through five or six years without having to make a claim against your car insurance policy you will be offered the chance to protect your car insurance No Claims Bonus that you have built up with something called Maximum NCD protection. For a small additional premium you will be offered protection for your Bonus years which means that in the event of an accident where you are forced to claim, your subsequent year's premiums will not be increased. When considering whether to purchase this additional cover it is well worth remembering that even if you have a no fault accident in year six of your driving, that forces you to make a claim due to the high cost of repairs to your car, your car insurance premiums the following year will rise by at least thirty percent and with some Car Insurance companies this can be much more. Maximum No Claims Bonus protection is a relatively new cover introduced within the last twenty years, no so much as a feature of choice from the Car Insurers, but moreover a necessity to tie existing customers into another year of policy contract, when the policy is due for renewal. This device worked well in early years however with the advent of claims databases and Car Insurance Companies exchanging data between themselves, it has become increasingly easier to transfer earned 'No Claims' years to another Car Insurer, who will in turn honor offer protection for this discount. You will usually be asked to provide 'proof of no claims bonus' in the form of a renewal offer letter if you renew your car insurance policy with a different insurer, or if you decide to cancel your current policy and change cover 'mid-term', you can ask the old company to provide a 'standard letter' of proof.
As with every insurance decision you need to weigh up the cost of purchasing this additional cover against the likelihood of a claim and the personal cost to yourself if you are forced to make a car insurance claim.
Dave Healey is a [http://www.car-insurance.tv]specialist car insurance underwiter who has been specialising in underwriting unusual car insurance and [http://www.car-insurance.tv/classiccarinsurance.htm]Classic Car Insurance polices at Lloyds for over thirty years.
Article Source: http://EzineArticles.com/?expert=Dave_Healey http://EzineArticles.com/?Understanding-Car-Insurance-No-Claims-Discount-and-Bonus&id=2110030
