Should I get comprehensive insurance on an old car?

An old car on a country lane

There are three different levels of insurance and it can be difficult to decide which level is the best one for you, especially if this is your first car and you are new to the whole world of insurance. There are several different factors that can help you decide which level of cover to go for and one of them is the age of the car. 

The minimum amount of cover that you must have to legally drive is third party. With this insurance your own car is not covered for any damage however damage to another person’s car or property is covered. 

Why do we need car insurance? 

We have needed to have car insurance since The Road Traffic Act 1930 came about. Driving without insurance can lead to a large fine and three points on your licence.

Depending on which type you go for you can be assured that in the unfortunate scenario where you are in an accident you will receive financial help in paying for the damages to another person’s vehicle or property and if you have comprehensive insurance, it will pay towards repairing your car too.

What is comprehensive insurance?

Comprehensive insurance is the highest level of cover that you can obtain. It is sometimes thought that this must be the most expensive level but oftentimes it can actually be the cheapest as higher risk drivers are more likely to go for third party cover. Insurers understand this so normally the premiums for the basic cover are higher. 

With comprehensive insurance the following is normally covered as standard – 

  • Damage to another person’s vehicle or property
  • Injuries to other people
  • Damage to your own vehicle
  • Injuries to yourself and your passengers 
  • Fire damage – Either accidental or arson 
  • Theft of your car 
  • Chips and scratches to the paintwork 
  • Malicious damage
  • Accidental damage

Some policies will come with some extras added in, or you can ask for these to be added at the time you set your new policy up. Although adding them will more than likely increase your premiums 

  • Breakdown cover
  • Courtesy car
  • Motor legal protection
  • No claims discount protection
  • Windscreen cover
  • Lost keys cover

Why shouldn’t I get comprehensive insurance on an old car?

There is no rule that says you cannot have this highest level of cover on an old car. If you are driving regularly it may actually be a good idea to have the best coverage that you can afford however when you take into account the age of the car and it’s value it might not be a financially sound decision. 

When you set up your insurance policy you will be told what the compulsory excess is. This is a set amount of money that you will have to pay in the event that you claim on your insurance. You will also be asked what you would like the voluntary excess to be set at. Normally the higher you set the voluntary excess, the lower your premiums are. These two amounts combined will be the amount that you will need to pay yourself when you make a claim before your insurance company will pay the rest of the amount towards repairing the damages. 

Example –

  • Let’s say that you car is worth £200
  • Your compulsory excess is £250
  • Your voluntary excess is £200

In the event of an accident you will need to pay £450 out of your own pocket on a car that is worth less than half of that. You would need to decide if it is worth paying or are you in a position where you could buy a new car instead?

What are my options if I do not want comprehensive insurance?

The minimum amount of cover that you must have to legally drive is third party. With this insurance your own car is not covered for any damage however damage to another person’s car or property is covered. 

There is also third party – fire & theft. This is very much the same as the standard third party insurance where damage to another person’s vehicle or property is covered and although your vehicle is still not covered for damage, it will be covered in the event of theft or fire. 

These two options can be great if you know that in the event of an accident you would not want your car to be repaired due to its age and value. 

How do I decide?

It is a decision that is purely up to you and will depend on your finances and whether you feel comfortable knowing that if you did have an accident in your car, would you be in a position to purchase a new one.

There are many price comparison websites online where you can compare different levels of cover. These will also tell you what the compulsory excess would be should you decide to take out the policy with them. Knowing the excess you would be expected to pay, along with knowing the value of the car, can go a long way in helping you decide which cover to go for. 

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