Insurance Changes as of 2010

What many people may not yet be aware of is the fact that insurance groups for cars officially changed in January 2010. The change has been brought about as it was felt that the old 1-20 groups for vehicle classification were not repesentative and accurate enough to gauge the cost of repair/replacement of a car. In the UK we now have 1-50 groups (50 being the most expensive) so in time, the old grouping will be re-classified and roughly doubled to make fit in with the new format.

This may be seen in our car database, with erratic looking insurance group data in some cases. Older cars still rate on the old system with newer cars having - what looks like - elevated numbers above group 20!

To simplify matters, if you see a car with insurance group 21 or above then it is already on the new system. If below, it might be on the new system and you are going to have to roughly double the number you see if it looks suspiciously low.

Types of Insurance Coverage

Insurance on your car is a legal requirement for driving in the UK, and can be split into 3 main types of cover: 

Third Party - The most basic level of cover, significantly cheaper than the other types, will cover the third party (vehicle and personal damage) in an accident. Essentially the policy holder will have no insurance cover to assist with their own vehicle damage or personal injury.

Third Party, Fire & Theft - Similar to Third Party cover, with the addition of insurance against theft of the vehicle and fire damage.

Fully Comprehensive - The most expensive cover, and also the most protective. In addition to the previous insurance types, the policy holder and vehicle will be covered in most circumstances. Another benefit of 'Fully Comp' is the ability to build up a 'No Claims Bonus' which is a percentage decrease in insurance cost that will stack year after year (maxing out at about 70% after 7 years).

Car Manufacturer Reliability
Insurance Type
Pro's
Con's
Third Party Cheapest cover No personal cover for personal damage or injury. Theft and fire damage not covered either.
     
Third Party, Fire & Theft Cheap cover No personal cover for personal damage or injury.
     
Fully Comprehensive Allows for building up of No Claims Bonus. Personal cover included. Most expensive cover.


Tips to reduce your car insurance costs
With car insurance premiums rising – the AA British Insurance Premium Index reports a £50 average rise during 2008 – it`s vital to pick the right car insurance policy. While it may be tempting to cut your cover to secure a cheaper deal this could prove costly should a claim be necessary.

As such it`s vital that motorists look for additional ways to reduce car insurance costs.

Tips and hints to slash premiums
Shop around online: Most providers offer discounts of five to 10 per cent if you shop with them online due to reduced overheads. The quickest way to find cheaper car insurance is to use a comparison website which will compare car insurance quotes from as many as 90 insurance companies. This allows you to compare policy features as well as prices, so that you can get the best value car insurance for your needs. 

Choose your car carefully: Drive a vehicle with conventional parts, a low insurance group and a small engine capacity if you want to reduce your insurance risk.

Cut out unnecessary extras: Don`t pay over the odds for cover that you don`t really need – for example, do you really need a courtesy car if you have access to another vehicle in your household?

Increase security: Fit security devices such as a car alarm or immobiliser to save money. If possible, park your car in a garage at night to keep it away from the prying eyes of thieves. 

Agree to a higher voluntary excess: The higher your voluntary excess the lower your premiums will be, although you should avoid agreeing to a voluntary excess that you simply can`t afford, should you need to make a claim.

Drive carefully: Avoid accidents and convictions. No-claims discounts can equate to as much as a 70 per cent discount for five years worth of claim-free driving, while some insurers will increase premiums by 74 per cent if you have more than one speeding conviction on your record, whilst one conviction for using a mobile phone while driving could hit your premiums by 54 per cent. 

Limit your mileage: The less time you spend on the road, the lower your chances aof being involved in an accident and the less of a risk you are to your insurance company.

Take an advanced driving course – The Pass Plus scheme is particularly popular with new motorists who can pick up the certificate with just four hours of driving time with their instructor - and earn a discount from the insurance companies who participate in the scheme.

Pay annually: If you can afford to, pay your premium annually rather than monthly to avoid interest charges.

Some thoughts on car insurance providers
Most car insurance providers claim to be the best and there are specialists that target specific groups – such as classic car drivers and women drivers – with unique policy options. The key for consumers is to compare car insurance policies online and always review your options at renewal time.