Let's talk about motor insurance. There are some variables and strategies to keep in mind to when it comes to premium costs. The first decision that needs to be made is on the type of cover needed, for example:
Third party insurance. This only covers your liability to others. Damage to yourself or your vehicle is not covered here. Alternatively there is third party with fire and theft cover, or there is comprehensive insurance cover. You also need to consider whether you want additional features to your cover such as roadside assistance or a replacement car when yours is not available.
Insurance premium costs are normally determined by risk factors. Among them are:
Age of the driver.
The record of previous convictions for traffic offences.
The record of previous accident and claims history.
The value and power of the car since more expensive and higher powered cars often have a higher probability of theft or accident, as well as higher repair costs.
The location and its crime rate.
But at the same time, there are some common strategies for reducing premiums:
The ability to park your car 'off-road' or in a garage.
Locking your car with an immobilising device, but remember if you promise to do this, you must actually do it.
Taking on a higher policy excess.
Building up a no-claims discount
Next time you change your car, consider choosing one in a lower insurance 'group'.
Trying new providers - online, telephone, motor insurance brokers, insurers specialising in market segments (for example, women drivers or older people)
Shopping around extensively.
Where a household has multiple cars, investigating a 'family' motor insurance policy that allows any household member to drive any car.
Taking and passing an advanced driving qualification.
Motorbike insurance is often more expensive than that for cars because the probability of accident and injury is higher, but the same practical principles apply.
Boat insurance is also similar to that for cars as it is necessary to have at least third-party insurance. Holiday caravan owners may also want to consider insurance and the risk attached to the loss or theft of the caravan from home or while on holiday. Some insurers though, may include caravan insurance as part of a main household insurance policy.
So once again don't be passive - there are things you can do to shape the terms of your car insurance policy to fit your needs and your budget.
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