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Published 19 December 2022
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Compare Car Insurance

Comparing car insurance providers can help you find the best deal, but being clear about what is and isn’t covered is important. We explain the features available and what to consider.

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About Car Insurance

Car insurance is a legal requirement for drivers in the UK and can cover your costs if something goes wrong. The minimum requirement is that you purchase third party cover, which protects you if you damage someone else’s car or property, or cause an injury. You can also choose to purchase cover for damage to your own car, fire damage, breakdown and more.

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A variety of factors will be taken into account when a company offers car insurance quotes. Your driving history, age and the type of vehicle you are looking to insure will all be considered by the car insurance provider.

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What type of car insurance do I need?

Car insurance is usually split into three categories:

Third party

This is the most basic level of car insurance. With third party car insurance, your provider will cover costs you might have to pay as compensation for injuries sustained by other people or damage to someone else’s property. This is the minimum level of cover legally required in the UK.

Third party car insurance does not cover your own injuries, theft of your vehicle or any breakdowns. You would need to pay for these yourself.

Third party, fire and theft

This level of car insurance provides the same level of cover as third party, plus protection if your vehicle is damaged by fire or stolen.

This means you would not be covered for any damage to your own car in an accident.


Comprehensive insurance is the most complete level of cover on the market. As well as everything covered by a third party, fire and theft policy, you will also be protected against damage to your vehicle and personal injury costs. Comprehensive policies can also come with further cover and extra features, but the exact details will vary between providers.

How much does car insurance cost?

The Association of British Insurers (ABI) reported that the average premium paid for comprehensive motor insurance in 2021 was £434. You may find that your quotes are above or below this figure, as the cost of your car insurance will vary from person to person. The cost of your car insurance will be tailored to your circumstances and will depend in part on how likely insurers think it is that you will make a claim.

Insurers will use personal information to calculate a risk profile for a driver. Certain factors will make you seem more of a risk, based on what the insurance provider’s data suggests constitutes a driver who is more or less likely to have an accident.

What affects the cost of car insurance?

You could also try to reduce the cost of your car insurance by haggling with the provider, especially if your deal is up for renewal.

For some drivers, especially if you have recently passed your test, what’s known as telematics car insurance can be a way to reduce your premiums. Also called black box insurance, this involves a provider installing technology to monitor your driving habits.

How to get cheaper car insurance

There are a lot of ways you can try to reduce the cost of your car insurance. Car insurance premiums are partly based on how the provider judges the chance of you needing to make a claim, so if you can reduce that risk your costs may go down.

Building up a no claims discount (NCD), also known as a no claims bonus, can indicate to prospective providers that you are less likely to make a claim on your car insurance. For every year you don’t make a claim, your NCD goes up. This can end up having a big impact on how much you pay.

Even if you are happy with your current provider, not letting your current policy auto-renew could be one step to getting cheaper car insurance. There might be better deals out there.

You could also take more steps to secure your car. This might include installing a security alarm, immobilisation technology, using a steering wheel lock or parking your car on a driveway or in a garage instead of on the road.

If you are a young or inexperienced driver, you could take an advanced driving course or add a more experienced driver as an additional motorist on your policy.

You could also consider black box insurance to show your insurer you are a safe driver.

Increasing the amount you have to pay as voluntary excess – the part of the costs you have to pay out of your own pocket – will usually reduce your premium. However, you will need to make sure that you can afford to pay that much money if you need to make a claim.

Other ways you can get cheaper car insurance include:

What types of cars can I insure?

The make, model and year of your car will all factor into how much you are charged for car insurance. Some vehicles such as certain classic cars may benefit from specialist insurance policies.

Generally, an expensive car with a powerful engine will cost more to insure. That is because if you were to have an accident and make a claim, your insurer would need to pay out more to repair the damage. Also, some insurers may see driving certain types of vehicle and classes of engine as an indicator that you are more likely to be in an accident.

What policy features could I get with my car insurance?

If you opt for a comprehensive car insurance policy, you should be covered for damage caused to your car and any damage caused to other cars or property. Your policy should also protect you against personal injury costs.

Some comprehensive policies will include optional extra benefits, but you may have to pay more for these.

Common upgrades and extras include:

It is important to read your policy documentation carefully to find out what cover you are paying for. If you think a particular extra is essential, make sure that you take out a policy that lets you add it on.

Car Insurance FAQs

Do I need car insurance?

Yes. Anyone who drives a vehicle is legally obliged to have third party insurance as a minimum. This will cover you if you cause damage or injury to another driver or someone’s property when using that vehicle.

Anyone caught driving without insurance runs the risk of a penalty fine and points on their licence. It could even escalate to court action, a criminal prosecution and a ban from the road.

How do my life circumstances affect the cost of my premium?

Social demographic is one of the factors that is most tricky to understand, and each insurer has their own guidelines and algorithms to arrive at a final cost. You might understand mileage and speeding tickets being factors, but what about occupation and number of children?

Insurers do not reveal their exact reasoning for arriving at a particular figure. Your job could have a major effect, for example; a job that requires plenty of driving such as a rep or even a journalist could cost you more when it comes to renewal.

Do I need business insurance?

Whether you need business car insurance will vary depending on how you use your vehicle for work. For example, if you work as a courier, you will need courier insurance to drive your car, van, moped, or motorbike. However, if you simply use your car to commute to work, then standard car insurance should cover this – but be sure to make this clear when you get a quote.

Can I insure a car I don’t own?

Sometimes. You can insure a car for someone else, such as a son, daughter or partner, and you can also insure yourself before you buy it. But you will be required to tell the insurer that you are not the owner or registered keeper, and some may refuse to insure you in this instance. The most common scenario is insuring a car you own.

Can I drive someone else’s car?

Possibly, although you should check the terms of your cover before getting behind the wheel. Bear in mind that, even if you are covered to drive other cars, you may not have the same level of cover as you do when you drive your own vehicle.

There may be certain groups of drivers who cannot drive other cars under their insurance, such as new drivers.

Can I drive any car with comprehensive insurance?

You might be covered to drive any car with a comprehensive policy, however not every type of car insurance will offer this. Check your policy documents carefully for Driving Other Cars (DOC) cover before you drive a different car to the one listed on your policy. You should contact your provider to clarify with them, and take out additional, temporary cover if necessary.

How important is no claims bonus?

Drivers who have not made a claim for several years are likely to be offered car insurance at a discount because insurers will typically view them as a lower risk. For each year that you drive without making a claim, your insurer will award you one year no claims bonus, or discount. This means you can build up your no claims bonus over the years.

According to the ABI, drivers can have a discount of as much as 30% after one year, and this could rise to 60% if you’ve made no claims after five years.

Some insurers will offer to protect your no claims discount, which means you can make a certain amount of claims over a set period of time without losing your No Claims Discount (NCD) However, the way this discount is applied varies between insurers, so do shop around and make sure you keep proof of your NCD, which will be on your renewal quote from your current insurer.

What else do I need to know?

Don’t be tempted to tell a white lie to lower your premium, as if you are caught, the insurer could cancel or void your policy. Lying on your application could also make it more difficult and expensive to get insurance in the future.

As with most insurance types, it is usually cheaper to pay in one lump sum than monthly.

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