Part 11e Insurance and you

Motor insurance

There are a number of different types

of motor vehicle insurance, but whichever you choose, you need to make sure you value

your vehicle properly

when you take out insurance. The value affects not only your premium

, but also your claim

.

Unlike household contents, the value

of a motor vehicle decreases

every year and is determined mainly by market forces - in other words, how much you could get if you sold it. However, the rate at which it devalues is also affected by things like mileage and maintenance. It is important to adjust the insured value every year

so that it is accurate. If you fail to do this, you will be over-insuring (and paying too much).

Read your policy and make sure that you are properly covered.

Factors affecting your cover or premium

The insured:

Your cover and premium take into account your personal circumstances (for example, age, claims history, etc).

The type of vehicle:

The premium and cover can be influenced by the type of vehicle (for example, year, make, model and value).

The security fitted to your vehicle:

Check whether the security you have fitted is acceptable to your insurer.

Where you live:

Insurance claims are more frequent in certain areas due to higher risk factors.

The place where the vehicle is kept, especially overnight:

The chances of theft are lower if your vehicle is locked and parked in a locked garage.

What you use your vehicle for:

Is it for pleasure, driving to work and back, or for business? Inform your intermediary or insurer if anyone else would be driving the vehicle.

Types of insurance

Third party:

If you have an accident and you are responsible, your third party insurance covers injuries to other people (including passengers) as well as damage to other people's property. Should a passenger be injured as a result of your negligence, the insurance company will cover their injuries too, over and above the Road Accident Fund.

Third party, fire and theft:

This provides cover for fire and theft, in addition to ordinary third party cover. There may be an excess that you have to pay.

Comprehensive:

Comprehensive insurance is cover for damage to your own vehicle combined with third party, fire and theft cover. This gives you the broadest possible cover. You usually have to pay an excess.