The most common car insurance myths debunked

June 5th, 2023
The most common car insurance myths debunked

Car insurance can sometimes feel a little bit bamboozling, not least because there are many long-standing myths surrounding it. It is important to separate fact from fiction so you can be sure to choose the right policy for you.

In the UK, every vehicle that travels on the roads needs to be insured. The Citizens Advice Bureau warns that police can check on the spot if a vehicle is insured by using the Motor Insurance Database [1]. If you don’t have valid insurance, your car can be seized immediately and disposed of 14 days later.

A recent survey found that around 90% of people in the UK were running the risk of a fine or points on their licence because they believed at least one common myth surrounding car insurance [2]. Here, we aim to eliminate confusion over car insurance by sorting the fact from the fiction.

So, does comprehensive insurance allow you to drive someone elses car?

‘Does fully comprehensive cover driving other cars?’ is one of the most common questions that confuses drivers. Many people mistakenly believe that having fully comprehensive car insurance cover on their own vehicle also allows them to drive anyone else’s.

Comprehensive insurance essentially means that you are covered for damage to you, your car and a third party if you are involved in an accident (whether or not it was your fault). It also covers theft and fire damage. It is usually the highest level of protection you can get from a car insurance cover and many drivers select it so they can get total peace of mind while on the roads.

There is confusion, however, because while some comprehensive car insurance policies do automatically cover the driver when driving other vehicles, nevertheless there are others that do not. This aspect of comprehensive cover is called driving other cars (DOC). Traditionally DOC has given drivers third-party protection when driving other cars, as long as they have the owner’s permission. DOC, which is usually intended for use only in an emergency, is still a feature of many comprehensive policies – but not all.

That is why it is always important to check car insurance policy documents carefully before driving a vehicle owned by someone else. For example, many insurance policies for people under 25 do not include DOC cover.

Temporary car insurance can be a great solution if you need to borrow someone else’s car for a short while (make sure to always ask their permission). Temporary car insurance can be taken out to cover you by the hour, week or month and usually offers comprehensive cover as standard.

Do you have to report an accident that was not your fault to your insurer?

Another common misconception is that you do not have to report accidents that were not your fault to your insurer. You should definitely report any accident that involves your car, however small, to your insurer, even if it was not your fault. In fact, failing to report even a minor accident can mean your car insurance agreement could be invalidated by your insurer and they may fail to pay out on a claim.

Almost every insurance company includes clauses in their policy which require you to report any incident from the past five years, even if it happened in a vehicle that was not your own such as a company car or fleet car. Failure to declare something would be deemed as non-disclosure, which can invalidate your policy.

Your no-claims discount will not be affected if you report a non-fault accident. Unfortunately, however, your future premiums probably will be increased, as an insurer will likely consider you a higher risk, even if you were not the at-fault party.

Does your job title affect your car insurance premium?

It is true that your job title impacts your car insurance premium. Your job has a big impact on how much you pay because it can affect the perception of you and your safety level.

For example, nurses and firefighters are among the job titles that pay higher insurance premiums, while chefs paid the highest premiums in 2023. This may leave some drivers tempted to make subtle changes to their job title when taking out car insurance in an attempt to secure cheaper premiums. It is important to note that failing to declare the correct job title can invalidate your policy and mean that claims you make in the future could be rejected by your insurers.

Can I put an older driver, such as a parent, as the main driver to help lower my policy premiums?

It is also true that putting an older, more experienced driver as the main driver on a policy may lower your premium. This can be especially appealing to younger, newly-qualified drivers who often face the highest premiums.

Unfortunately, this practice, known as ‘fronting’, is illegal. While it may lead to a lower premium, it carries a huge risk. Anyone found to be fronting can have their insurance policy invalidated or cancelled. It might also lead to a fraud prosecution, which will appear on their criminal record [3]. Instead, a young driver seeking to reduce their premiums could add a low-risk driver such as a parent to their insurance as a second driver.

Can lower mileage mean cheaper car insurance?

It is a well-established myth that a car which drives fewer miles is cheaper to insure. This is not always the case. On the contrary, some insurers may see those who drive only occasionally as higher risk because they may only drive their car for short trips at busy times. They could be considered more of a risk than someone who drives the same route to their place of work every day. It may also lead them to be seen as less confident and accomplished as drivers.

Always declare your mileage truthfully, by looking at previous MOT certificates and service certificates when selecting a car insurance policy. Claiming to be a low-mileage driver while clocking up thousands of miles each year might lead to your car insurance being invalidated.

If you do drive less than the UK average of 8,000 miles per annum, you may be better off selecting a pay-as-you-go car insurance policy or pay-by-mile insurance. Another option is to choose a low-mileage car insurance policy.

Always use a price comparison service such as Free Price Compare to ensure you are getting the best policy for you. And don’t forget that any changes in your job or circumstances which can increase your annual mileage during the term of your policy should be reported to your insurer immediately.

Does the colour of the car impact the price of your insurance?

There is a common misconception that the colour of a car affects the premium you pay. While many physical characteristics of your car are considered when calculating your cost, colour is not one of them. Your premium is based instead on a mixture of facts about you and your car, such as the age, make and model of the car and your driving history. The paint type used on a car can have some impact on price but, again, the colour is not a consideration. Many people mistakenly believe red cars to be more expensive to insure.

Does parking a car in a garage reduce my insurance premium?

Many believe that parking your car in a garage results in lower premiums but, perhaps surprisingly, this is not actually the case. While a garage may seem more secure than street parking, there is also a higher likelihood of an accident when driving in or out. It is recommended to compare prices for parking on a driveway and parking in a garage if you do have access to both. In many cases, the benefit of parking in a garage on your car insurance price may be negligible.

Are new cars always more expensive to insure?

Do not assume that new cars are always more expensive to insure than older ones. They may be, but sometimes they are actually cheaper. Newer cars are often considered a lower risk because they tend to have the most up-to-date safety features, such as cameras, adaptive cruise control and immobilisers. Many of these advanced features can help lower car insurance premiums.

Figures also show that thieves tend to target older cars because they are easier to break into due to less rigorous security measures. In addition, parts from older cars can often have more value on the used market than parts from brand-new cars. Market value is often more of a determining factor than age when it comes to car insurance quotes, as are the age of the driver, their driving history and occupation. Always compare car insurance prices to be sure you are getting the best deal for your particular circumstances.

Can you negotiate on your car insurance premium?

This commonly held belief is untrue. Car insurance is calculated quite scientifically based on a series of factors which determine the risk you pose. This includes the make and model of the car, the number of miles driven and your driving record. You cannot simply negotiate a better deal. One insurer may offer a lower quote than another but this is because of the different method they use to assess your risk.

There are, however, steps that can be taken that may lower your car insurance premiums. For example, you could install a black box in your car to track your driving habits or add a safe driver as a second named driver. Either of these measures might reduce the cost of your insurance.

Is third-party car insurance always the cheapest?

Third-party insurance provides the minimum level of cover and so you may expect it to be the cheapest. Third-party car insurance means if you cause an accident or damage to another person’s car or property, the damage will be paid for by your insurer. It does not cover damage to your own vehicle. If your car is damaged by fire or is stolen, you cannot make a claim under third-party insurance.

However, it is not always the cheapest option and drivers should shop around and compare car insurance before purchasing. In some cases, comprehensive cover may be only a small amount more expensive. You can do car insurance comparison through Free Price Compare, checking quotes from scores of providers within minutes.

Can I still get car insurance if I have had my policy cancelled?

Car insurance policies may be invalidated or cancelled for many reasons, particularly if a policyholder has submitted false information or failed to inform insurers of accidents or changes to their circumstances. If you have been left asking ‘I had my car insurance cancelled who will insure me?’, then what are your options?

First, you can try to fight the cancellation. Policyholders are often given a 10-day grace period before their policy is cancelled. If, however, you are unable to get it reinstated, you must still have insurance before you drive.

Alternatively, you can look for car insurance from a different provider, although you may find you have to pay a much higher premium depending on the reason for the cancellation. Never drive without insurance as this will result in your licence being suspended.

How to avoid falling for common car insurance myths

The best way to avoid falling for myths and misconceptions is to really educate yourself. If you are planning to take out a car insurance policy, be sure to read up on the topic so you are not influenced by a misconception or myth.

Always check car insurance quotes and offers carefully, using a comparison website like Free Price Compare. Simply input a few details about yourself, your vehicle and your driving history and Free Price Compare will sort through dozens of insurance quotes from hundreds of providers so you can find the most suitable and cost-effective option for you. Your car insurance company should be able to answer any questions or queries you have along the way.

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