There are three types of motor insurance. Depending on your circumstances and on the age and value of your car, you need to consider what insurance suits you best.
- Third party cover
- Third-party, fire and theft cover
- Comprehensive cover
The table below explains the levels of protection given by each type of insurance:
This is the minimum legal requirement and pays out for claims that other people make against you for damage or injury caused by your driving. With this type of cover, you cannot make a claim for damage to your own car, theft of your car, or loss or damage to any item in your car under your own third-party insurance.
In addition to third-party cover, you can claim for loss or damage to your own car as a result of fire or theft, but not accidental damage to your vehicle. This type of cover costs more than basic third- party cover.
This gives you third-party fire and theft cover but also allows you to claim for damage to your own car, no matter who is to blame. The benefits of comprehensive policies vary between insurers, so you should check your policy for details, but the cover will usually include benefits such as:
- Windscreen and glass cover
- Cover for damaged or stolen personal belongings – this usually applies to items stolen from a locked boot or glove compartment. The amount you can claim depends on your policy.
- Recovery service and emergency breakdown assistance
- Driving other people’s cars – this covers you for any damage you do to another car or person while driving someone else’s car. It does not cover any damage you do to yourself or the car you borrow.
- Replacement or hire car – the cost of this is covered if your own car is off the road as a result of an accident
- Replacement lock cover, alarm cover and fire brigade charges
Extra benefits you can get with a comprehensive policy:
- No-claims discount protection
- Named driver on vehicle
- Open driving – allows anyone with a full driving licence to drive your car with your permission
- Driver personal accident cover
You can expect to pay a higher premium for comprehensive cover than for third-party fire and theft cover.
Check your cover and excess
You should always check your policy for details about what it does and does not cover.
Most motor insurance policies include an ‘excess‘ clause. This means you must pay the first portion of any loss or damage to your own property, usually up to a few hundred euro.
You will not be able to claim for amounts less than the excess. The higher the level of excess, the lower your insurance premium should be.
|TIPS ON CUTTING COSTS||MORE INFORMATION|
|Get the right level of cover||Comprehensive cover costs more than both third-party and third-party fire and theft cover. If your vehicle is old or low in value, consider whether the extra cover you would get from a comprehensive policy is worth paying the extra premium. But make sure you get the cover you need.|
|Try to be as realistic as possible when estimating the value of your vehicle||If you overestimate the value of your car, the insurance will cost you more. If you have a fire or theft claim, the insurance company will only pay what they consider to be the market value of the car, no matter what you have insured it for. Don’t under-insure either, because it will be difficult to replace your car if you need to.|
|Get more driving experience||Costs will depend on whether you have a full or provisional licence and how many years you have been driving. You will be charged more if you have a provisional licence, so try to get your full licence as soon as you can. Build up driving experience on your own policy or as a named driver on someone else’s policy. Insurance companies will not include driving on someone else’s open-driving policy as relevant experience.|
|Avoid driving convictions and penalty points||Serious driving offences such as dangerous driving or drink driving can result in an increase in your premium or even a refusal to offer you insurance. Depending on the number of penalty points you have, your premium may also increase.Get more information about good driving practices from the Road Safety Authority.|
|Think before adding named drivers to your policy||The cost of adding a named driver to your policy depends on a number of factors including their age, job, the type of licence they hold, their driving experience and how often they use your car. It is also affected by their relationship with you and any claims they have made or claims made against them.|
|Don’t allow anyone to use your car unless they are insured under your policy or their own policy||If your car is in an accident, your insurance record could be affected, even if you are not to blame. You could also face prosecution for letting an uninsured person drive your car.|
|Build up your no-claims discount||You can lower your premiums by up to 70% if you haven’t made a claim or a claim hasn’t been made against you. If you want to switch insurers, check first whether you will be able to carry over your full no-claims discount.|
|Change where you park your car||You may be able to save money if you let your insurer know that you park your car in a locked garage. Insurers often prefer this to the car being parked on the street or in your driveway.Some areas will have higher claim rates and you will pay more if you live in a city than in a rural area.|
|Pay more excess||Some insurers give you the option of cheaper cover if you pay a higher excess.|
|Choose your car wisely||The more expensive your car and the bigger its engine, the more you are likely to pay. You may also have to pay more if your car is imported or if there are more theft claims on your model of car.Check with your insurer before you buy a car, so you can estimate insurance costs.|
|Decide if you need to use your car for work – if so, you need different cover||It costs more to insure a car or van for commercial use than for personal use, which includes driving to and from work. You will usually have to pay commercial premium rates if you drive a van, even if it is only for domestic use.Check with your insurer first. Also, check with your insurer about the definition of ‘use for work’ in your policy and ask about cover for work-related items in your car.|
|Check with your provider and shop around – you may get a better deal elsewhere||Always get quotes from several insurance providers when you need to get or renew insurance. To help you shop around for insurance quotes use our motor insurance shopping around checklist.|
|Try to get insurance in your own name||Some insurers will not consider your previous driving experience or your existing no-claims discount if you haven’t had insurance in your own name or been named on an insurance policy within the last two years.|
If you think you are being overcharged unfairly
Under current equality law, when you buy goods or services including financial services you cannot be discriminated against purely because of:
- Marital status
- Family status
Insurers cannot refuse to give you cover, or charge more for any of the above, unless they can show that the difference in treatment is reasonable and justified in relation to the risks involved.
Your no-claims discount (often called your no-claims bonus) is a reduction in your insurance premium based on the number of years since you have made a claim, or a claim was made against you. Only the policyholder can earn a no-claims bonus.
The maximum discount is usually allowed if you have had no-claims in five years. If you have not had a claim for 10 years, you will still only get the same maximum discount. A full no-claims discount usually means that your premium is about half what it would be with no discount.
Your discount may be reduced or lost if you make a claim or a claim is made against you, even if you were not at fault, such as if your car was stolen. If you have an accident and you were not at fault, your discount may be restored if your insurance company recovers its costs from the other person’s insurer.
Some insurers will allow you to pay a sum that guarantees all or part of your no-claims discount. Depending on the insurer, you may be able to choose either a:
- Full no-claims discount protection
- ‘Step back’ bonus protection
- No-claims discount protection for fire and theft claims
It is important to check how your no-claims discount would be affected before you make a claim. Your no-claims discount can be transferred from one insurance company to another and from one car to another. However, if you have two cars, you will need to work up a no-claims bonus for each car. Each no-claims discount is specific to one vehicle at a time. This means that if you buy a second car, you would not automatically get any benefit from your existing no-claims discount. However, some insurers may give you an introductory discount if you have a good claims record on your main vehicle.
This usually means you do not lose your no-claims discount even if you have:
- A number of fire and theft claims
- Any two claims within three years
- Any one claim for any amount within three years
If your total claims go over these limits, you will lose your no-claims discount completely.
If you have this type of policy and there is a claim on your policy, you would lose part of your no claims discount, but not all of it. For example, if you had a 50% no-claims discount, it could be ‘stepped back’ to 30%. Some insurers do not charge extra for this type of no-claims discount protection.
This means you would still keep your no-claims discount if you have a claim for fire or theft only.
Will you lose your no-claims discount if you stop driving for a while?
If you have no insurance in your own name for two years or more, many insurers will not give you your no-claims discount when you reapply for cover. Before you sell your car or go abroad, check with your insurer how your case would be treated.
Save thousands on your insurance
To make things easier for you we have a very useful shopping around checklist. It will help you decide on the type of cover that you need and to keep track of the quotes you get and what they cover.
What firms should let you know when buying insurance
- Tell you how long their quote is valid for and make sure you are aware of any special conditions or restrictions that apply to the cover they are offering you
- Tell you about any discounts that apply or any extra premium being charged when they give you a quote
- Tell you that your cover or any claim you make could be affected if you give incorrect or incomplete information when applying for cover
- Issue your policy document within five business days of providing you with cover
- What type and level of cover best meets my needs?
- How many quotes will my broker look for? What extra services does my broker provide, such as help with making claims?
- What fee, if any, will I be charged by my broker or bank? Is this instead of commission or will they also receive commission?
- Could I get a lower quote by dealing directly with the insurance company or buying online?
- What loadings are the insurance company applying in my case? Am I paying more because of my car, occupation or where I live?
- Do I qualify for any discounts?
- Can I reduce my premium if I choose a larger excess?
- What is included in the policy and what is excluded? Remember, the policy offering the lowest premium may not always be the best value for money.
Don’t forget to bargain. If you get a good quote from one company, it is usually worthwhile to see if another is prepared to match or better it in order to get or keep your business.
An insurance company can refuse to sell you motor insurance as long as they are not in breach of equality law. However, if you ask for an explanation, they must write and tell you why.