There are three main types of car insurance:
- Third party: Covers the other car if you are at fault in an accident with 2 or more cars. Will never cover you or your car.
- Third party, fire and theft: This is similar to third party insurance but it also covers your car if it is stolen or damaged by fire
- Comprehensive: This covers every type of valid claim you make.
In the UK it is the law to possess at least third party car insurance if you drive a car. The reason for this is because a car can potentially damage or destroy possessions that do not belong to the insuree. Unlike health insurance it does not and cannot affect anyone else, or house insurance only affects a house from damage to the house or content. Both these insurances cover something that doesnt have as high a risk factor that it will damage someone else or their property.
Car insurance is compulsary because if you injure someone or damage their property while driving it is your fault so having insurance makes compensation more affordable than a lump sum that you mightn’t have and if you go to court and have no insurance and no money how can the other person be financially compensated? This is why car insurance is compulsary.
For more information on car insurance visit monetos.co.uk.
