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Chapter 1: How Does Insurance Work Anyway?

In 1896 there were only four automobiles in the whole of the USA. Somehow two of them ran into each other in St. Louis. That year in Great Britain, 44-year-old Bridget Driscoll was the first ever pedestrian to be knocked down and killed by a car.

Today, there are around 27 million privately registered and insured vehicles in the UK. Yours is one of them. And most of us will be involved in a bump, at least, at some time in our lives.

Because of that, we’re now all required by law to insure our vehicles. We have to renew that insurance every year.

Section 143(1) of the Road Traffic Act 1988 states:

“Every person who uses or causes or permits another person to use a motor vehicle on a road or other public place must have a policy of insurance covering at least third party risks.”

This statutory requirement relates to use of a particular vehicle, so it’s the vehicle which is covered, not you.

There is no legal requirement to have comprehensive insurance cover — but you must have third-party cover (which I explain shortly).

You may find as part of your insurance cover, you’re entitled to drive other vehicles and be covered under your own policy. I’ll talk about this in detail later in the chapter — but be aware it always depends on the precise terms of your policy, and will generally be restricted to the policyholder and not any named driver. Plus, the cover will be for third party only.

So if you have cover which applies for other vehicles, any claim you make will be under your own policy, not the insurance relating to the vehicle you’re driving.

The most important thing to remember is: never assume you’re covered, and check your policy terms before you get behind the wheel of someone else’s car.

Which type of motor insurance?

There are two types of insurance cover.

Third party or third party fire and theft

Third part, or third party fire and theft (TPFT) provides liability insurance where you cause injury or damage to another person or their property, including vehicles. This is the minimum statutory requirement.

It may also  cover your own vehicle if it goes on fire or is stolen (“fire and theft”).

If you’ve caused an accident in which the other driver or any passengers or pedestrians have been injured (“the third party”), the policy will cover you against claims from those people. It will meet in full the cost of any vehicle damage to the other car.

What it doesn’t cover in most accident collisions is damage to your own car. Your car might be damaged beyond repair and be written off completely — and you cannot make a claim on the policy if all you have is third party cover.

In the past these policies had a reduced premium and were often bought by younger drivers for private cars which were not particularly valuable.

Increasingly, though, there is not much price advantage on these policies. Third party policies now make up only 10% of the entire car insurance market and this figure is falling.

Insurance underwriters have found the people most likely to buy third party policies, namely newly qualified young drivers, are precisely the same people most likely to be involved in an accident, and who will have to make a claim on the policy for damage caused to other parties.

The days of cheap third party cover are long gone.


This is known in the industry as a “first party” policy, with you as the first party. The policy will provide cover against damage to your own vehicle as well as damage to other people and property.

In that latter respect it’s similar to a third party type policy. Comprehensive cover will also cover damage to your own vehicle regardless of who’s to blame for the accident. However, you’ll have to pay an excess before your insurers make any payment for repairs to your vehicle.

Comprehensive cover may also provide extra benefits like a courtesy car, breakdown assistance and windscreen repair or replacement. These benefits may not be standard and you may have to buy “add-ons” to the basic cover to get them.

The policy excess

Typically for adult drivers this is between £250 and £650. So if your excess is £250, you’ll have to pay the first £250 of any repair bill — not your insurers. The repairs garage will not release your car until you stump up.

That’s why the larger the excess you’ve agreed to, the lower your insurance premium is likely to be. In many policy documents now you’ll see a figure for the standard excess, together with an additional voluntary excess figure, making an increased total excess. Effectively the insurers will be paying less for any repair, and there will be a disincentive for you to claim at all under your own insurance for minor repairs.

There may also be a young driver’s  excess, which is an additional excess when the driver is under 25. Typical amounts are £300 for a driver aged 20 or under and £200 for those aged 21 to 24. This young driver’s excess is in addition to the standard excess.

Voluntary excess insurance

You can get insurance to cover your insurance excess. Welcome to the crazy world of car insurance!

Voluntary excess insurance is an additional insurance cover separate from your own car insurance policy, designed specifically to meet the cost of your excess should you have to claim.

At present it’s relatively cheap (e.g. prices quoted by AXA Assistance are around £30 a year for a £600 excess). So if you had repair costs of £1,250 and an excess of £500, the voluntary excess insurance policy meets the cost of the £500 repairs excess and you pay nothing to get your car back.

There are some categories of driver, such as young drivers or foreign drivers, who might well benefit from taking out a larger voluntary excess to get a big reduction in insurance premium — then covering it with a voluntary excess policy.

It’s a specialist product at the moment and your own insurers probably won’t tell you about it when you’re taking out your general policy. If you’re a young or foreign driver, it’s probably worth asking an insurance broker, or shopping around online.

At-fault and non-fault drivers

The categorisation of your accident claim will significantly affect your financial position. There’s a crucial distinction between an “at-fault” and a “non-fault” accident.

If you’re a “non-fault” driver in the accident, you should (in some cases after a long period of time) be put back into the same situation as your pre-accident condition — as well as receiving damages for any injury and your inconvenience. This applies whatever type of insurance you have.

If you are an “at-fault” driver, though, you’ll have to rely on your insurance policy. In this case, your insurers will be restoring the non-fault driver to his pre-accident position. Your excess doesn’t apply to these payments to third parties, although it will apply to damage to your own car.

Where you’re at fault, even though you won’t personally have to pay the non-fault driver, any passengers or anyone else you injure, you must still expect to pay a price. This will come in the form of a loss or reduction of your no claims discount, and then increased insurance premiums every time you renew.

How to avoid voiding your policy

Your insurance policy is a contract — a legal agreement binding on both you and your insurance company, which is made up of offer and acceptance.

In law, it’s known as a contract “of utmost good faith”. In previous times, you’d likely complete a formal written proposal form which would provide personal details including driving history and accident and claims profile. Those answers enabled the insurers to assess their risk in insuring you.

Some people still take this traditional route but it’s much less common. Nowadays the information is more likely to be obtained by question and answer from either your insurance broker or from your online application and subsequent conversations with web insurance providers.

In any event your answers, however you give them, must be scrupulously accurate. As a strict matter of law every statement or representation you make is deemed to be “material”. This means it’s binding even if it’s a minor error which doesn’t affect the essentials of the agreement.

Here’s an example: in an old legal case, an insurer was able to void the insurance policy and refuse to pay out because a woman used her maiden name, not her married name, on the contract of insurance.

The harshness and absurdity of this approach has been mitigated in recent years… but it can still apply where you misrepresent something which the insurers can establish was relevant to their risk and premium assessment.

You must be careful about any history of previous accidents or claims. The insurance industry has its own claims database called CUE against which they can check your answers. You should declare any penalty points on your licence even if they’re only for a parking offence.

You need to be clear about the category of use of the vehicle, too. The typical distinction is between social and domestic use (generally including business commuting but check your policy), and business use. If you are insured for business use only, you won’t be covered if the vehicle is damaged whilst under personal use, and vice versa.

All insurers are now subject to the Financial Services Ombudsman, who often deals with complaints from people whose policies have been avoided, when the insurers refuse to pay out.

The Ombudsman will support you only where the error or misrepresentation is non-material. Here’s an example:

There was a case in which someone didn’t declare their previous driving experience was in Australia, not the UK — and the insurance company refused to pay out when they discovered the facts. The Ombudsman upheld the insurer’s argument that this had affected their risk assessment. In other words, he found in favour of the insurer, not the driver.

Problems can also arise if you declare the vehicle is kept in a garage or on a driveway when it is usually parked on the road. Your policy can be avoided for this misrepresentation.

Beware of “fronting”

The policyholder has to be the main driver.

Some people think it’s a good idea to pretend a young person’s car is actually a parent’s car in order to get a lower insurance premium. So, they’ll put the policy in the name of the father or mother — but the car is mainly used by the young driver. This is known as “fronting” and if you get found out, it will always justify an insurer not paying out. Don’t do it.

Even after you’ve scrupulously answered all the questions honestly, and your insurance is in force, you’ll find you have an obligation to continue reporting to your insurer during the term of your insurance contract.

This usually means reporting facts like a change of vehicle, change of parking place, and any motoring convictions. And if you like “modding” your car, beware: I’ve seen policies avoided where “go faster” modifications such as spoilers have been added. If you add extras to your car, make sure you declare them.

The insurers justify this position not by saying your vehicle is more dangerous, but that the modifications mean that you personally are now in a different category as an accident risk.

What are your insurance terms?

Your insurance entitlements are made up of your certificate of insurance and usually a standard insurance policy — a generic document with no details personal to you. I’ll explain them below.

The certificate of insurance

The certificate of insurance stands alone as the most important of your insurance documents. It is evidence that you have the minimum cover required by the Road Traffic Act 1988 for your vehicle.

According to the Motor Vehicles Regulations 1972, certificates of insurance must follow a prescribed form. They must be in black and white, with no advertisements, and contain the following information:

  • Certificate number
  • Name and address of insurance company
  • Vehicle registration number
  • Policy holder’s name
  • Class of use
  • Beginning and end date of the insurance policy
  • Description of named people entitled to drive

Your insurers must give you a certificate of insurance under Section 147 of the Road Traffic Act 1988.

The certificate also usually states the policy holder or any named driver will be covered when driving a vehicle loaned to the policyholder or named driver from a nominated supplier — but this usually applies only whilst your car is being repaired, so beware of relying on it.

Section 147 of the Road Traffic Act 1988 states your insurer must send you a certificate of insurance when issuing a Road Traffic Act policy.

This is an important document and these days it might be a real paper certificate, or an electronic version.

Either way, a police officer is entitled to insist you produce a certificate in certain situations after an accident. So keep it safe or easily accessible and put a copy in your glove compartment.

Named driver and any vehicle cover

There must be a list of named drivers entitled to protection under the policy. You’ll have negotiated this and specified the named people when you bought the policy. Your insurer will decide your policy premium based on your and the named driver’s claims record.

There may be an “any vehicle cover” term which means the policy will cover you if you drive someone else’s car with the owner’s permission.

But this “any vehicle” cover is not automatic and depends on the express terms of the policy.

The “any vehicle” clause typically extends only to the policy holder and not to all the named people entitled to drive.

There will only be one policy holder.

So if you are simply a named driver on the policy and not the actual policyholder, you are probably not covered to drive a separate car under that policy .

Even if as named driver or policyholder you are covered to drive another vehicle under your certificate of insurance, this cover will be for third party only. It will cover people and property you injure or damage, but not the vehicle you’re driving.

So if you write off your rich best friend’s £40,000 BMW and it’s your fault, you won’t be covered by your insurance. And you’ll be personally liable for all damage and consequential losses to you and your friend. I can’t imagine that will make you popular, and it will certainly be financially painful.

The golden rule for everyone is to stop and think before getting behind the wheel of a different car.

A cautionary tale

If your insurance isn’t quite right, you may find you’ve fallen foul of the law.

On November 30, 2016 the Scottish Transport Minister Humza Yousaf was driving a friend’s car to a St. Andrew’s night dinner in Ullapool. He was pulled over for a routine check on the A835 near Dingwall.

He was named driver on a comprehensive policy which he believed enabled him to drive vehicles other than his own.

He wasn’t. As a named driver he remained insured to drive his own car at all times, but he was not the policyholder and so did not have all-vehicle cover.

Although he was driving his friend’s car with the owner’s permission he was in fact uninsured. He faces a fine of between £300-£5,000 — plus a compulsory six points on his licence.

A chastened Mr Yousaf has advised everyone who drives someone else’s vehicle to check the small print. 

The standard policy document

The standard policy document doesn’t usually contain any of your personal details. You’ll receive it when your policy begins, or at renewal. Most insurers have a standard copy on their website.

The document might contain a welcome section, e.g. the Motor Claims Helpline section from Aviva. This is not part of your actual policy, but is simply a non-binding explanatory introduction with sections on what your insurers hope you might do in the event of an accident, for example. It does not contain any contractual terms — and you don’t have to do as they suggest.

As you know, the contract of insurance has been taken out based on the information you supplied to the insurers. If this information changes you must tell your broker or your insurer, and in particular you must let them know about:

  • Any change in named driver
  • Any motoring convictions
  • Any criminal convictions
  • Any vehicle modifications

This will be a contractual term which means you must inform them of any change — so be careful to do so, or you could find yourself without insurance when you come to make a claim.

Then there is generally a definitions section, moving on to the various aspects of cover which your policy provides. You’ll find a written description of cover summary with various headings like breakdown assistance, courtesy and hire car, no claims discount.

Then there are various sections describing the nature and extent of the cover.

I suspect most people never bother to read their insurance policy. It’s not a difficult document, and you may learn something essential to your financial health — so take a few minutes and have a look at it.

Your no claims discount

If you’ve not made any claims on your policy you should get the benefit of a “no claims bonus” or a “no claims discount”.

As a bonus is something you receive and a discount means a reduction in price, the correct expression is really “no claims discount”.

It means your premium will be reduced on a percentage basis when you come to renew your insurance.

Let’s say you’re a new driver and have been quoted £600 for a year’s insurance. You’ll pay that amount in full.

If you continue to insure your vehicle without making any claim, then year on year you’ll build up a no claims discount. This can start as low as 5%, and might build up over the years to a maximum of around 60%, depending on the tables your insurer uses.

The idea is good driving behaviour is an indicator of lower risk and should be rewarded. So if your premium figure was £600 and you had a 50% no claims discount, you’ll only pay £300 for your premium — half the advertised price.

Unfortunately it is possible to lose your discount even when you’re not to blame. The AA carried out a “mystery shopper” exercise in April 2014[1]. The AA was attempting to find out insurers’ attitude to accidents which were not your fault, and where you’d made no money claim on your own policy.

Drivers who stated on their proposal form that they’d been involved in one no-fault accident were typically quoted around 30% extra on their renewal premium.

Where there had been two no-fault accidents, premiums could be up to 50% higher.

So you could be in an accident which is not your fault, you could make no claim of any kind on your policy, but you could still find your insurance premium has gone up by about a third.

The insurers justify this by saying people involved in one accident are more likely to be involved in another.

Adrian Webb of Esure said: “In many cases no fault claims can be a proxy for the environment in which you drive. For example, you may drive through certain awkward junctions, an accident blackspot, or be in a certain postcode that suffers from poor signage, all of which puts drivers at risk. Some insurers use statistical loss data in which people are grouped into pools of risk”.

You can protect your no claims discount by taking out a separate insurance “add-on” to cover it. The no claims discount protection add-on was one of the many insurance add-ons criticised by the CMA as being well-nigh incomprehensible for the average person.

But depending on the cost of the add-on, if you have a maximum no claims discount you should always consider protecting it by buying the extra insurance.

The first thing you need to do is find out the amount of your no claims discount. Neither your certificate of insurance nor your standard policy document will tell you this.

But your insurers will tell you if you ask them.

Insurance add-ons

Add-ons are extras your insurance company sells you after you’ve agreed to buy basic private motor insurance.

The CMA believes the insurance industry makes more money from selling add-ons than from the basic insurance policy itself. It estimates add-ons generate about £630 million a year for insurers. They have a very low average claims ratio — which means we all tend to pay for the add-on insurance but then we don’t make any claim on it.

You’ll generally agree to add-ons when you take out your basic policy, in discussion with your broker or insurance representative. When you’re talking, remember the nice person at the other end of the line is on a sales commission for every add-on you buy. (It’s called upselling.)

The most common add-ons are:

  • No claims discount protection
  • Legal expenses insurance
  • Courtesy car hire
  • Breakdown cover
  • Personal injury cover

Windscreen repair cover is sometimes sold as an add-on, but you often find some kind of cover in the  basic insurance policy.

No claims discount protection

You’ve already seen how important your no claims discount is. It can save you hundreds of pounds when you renew. The no claims discount protection add-on means your discount is protected in certain circumstances, even if you have to make a claim on your policy. There is widespread misunderstanding about this product.

In the CMA Survey of Private Motor Insurance Policyholders from June 2014, around 80% of people said they had no claims discount protection — but the evidence from motor insurers was that take up is very much lower than that.

People get confused between the no claims discount itself — which most people will have simply because of their claim-free history — and the separate add-on product designed to protect their no claims discount even if they have to make a claim.

Most people don’t understand that although the add-on means they keep their percentage no claims discount after they claim, it doesn’t prevent your insurers from increasing the basic premium at renewal time.

So if your basic premium is £550 with a no claims discount of 30%, after the 30% deduction you will pay a premium of £385. The no claims discount add-on will protect your 30% deduction, but it does not protect you against a rise in your basic annual premium, as discovered by The AA during its mystery shopper exercise.

So in the example above your renewal premium might well go up to around £680 because you made a claim. You’ll still get a 30% discount thanks to your add-on protection… but it’s a discount on an increased premium of around £484.

So despite your protected no claims  discount, your premium will go up by almost £100.

There is a solution to this.

Some insurers offer a guaranteed no claims discount protection add-on which protects your no claims discount and prevents your premiums rising in the event of a claim. But if you want this cover, you’ll need to shop around and ask questions of a broker or adviser.

Pay attention to the small print: insurers differ as to how many claims they’ll accept under the basic no claims discount add-on. In 2014 Aviva described its cover as:

“protection from up to 2 at-fault claims in a 3 year period. If any of your named drivers has had one at-fault claim in the last 2 years, you can still protect your no claims discount but it will only be protected against one at-fault claim in a 3 year period.”

The insurers used to be very coy about giving away information about how they operate their no claims discount tables.

The CMA found six of the major insurers — Admiral, Aviva, DLG, Esure, RSA and Zurich — did not make their no claims discount scales available on their website, and did not provide information to customer-facing staff dealing with telephone enquiries.

Insurers are now better at providing this information in tables on the policy documents, but it can still be difficult to understand.

So when you’re deciding on insurance, ask about the likely percentage discount you could earn in the future, and what effect one or more claims would make to it.

Legal expenses insurance

When most of us buy insurance polices, we’re buying peace of mind. We shouldn’t have to worry.

But we do.

If we’re not at-fault we worry we can’t recover our uninsured losses or claim for our injuries. We worry we might have to deal with an uninsured driver.

If we are at-fault we worry about being taken to court by the other driver. What if we are accused or careless or even dangerous driving? Who will pay the legal costs in these situations?

As a result, almost half of us take out legal expenses insurance each year, making it the most popular of all the add-ons. After all, if we can get the benefit of a crack team of lawyers fighting our corner and all for an annual fee of between £25 and £35, we’d be fools to ourselves to pass it by wouldn’t we?

But in reality legal expenses cover is not worth very much at all.

In 2013 the Financial Services Authority carried out a survey[2] on customer perceptions and attitudes towards motor legal expenses insurance.

The survey found widespread ignorance and misunderstanding about what legal expenses cover represents. A typical response was:

“I’m not even sure what legal cover is but I always put it on there. I hope what it is, is legal support when you need it.”

Which makes sense. And if that’s what you think it means, read the next few paragraphs very carefully indeed.

It turned out those interviewed had little or no idea what legal expenses cover really is. The first surprise was that legal cover to pursue uninsured losses and personal injury only exists if your insurers think you have reasonable prospects of success.

What does “reasonable prospects of success” mean? Good question. It’s rarely defined. Do the prospects of success have to be  51% likely or is it 75% likely? Your guess is as good as mine.

The insurers themselves will decide whether to authorise the cover with little or no input from you. As one interviewee put it:

“The holes in the safety net are certainly bigger! Reasonable prospect of successful recovery — it’s legal speak”

And another asked:

“Do we need it these days with personal injury lawyers?”

A good question. Legal expenses cover doesn’t offer any real advantage over any of the various “no-win no-fee” lawyers available on the internet.

The no-win no-fee law firms have an obvious interest in making sure you win your case, and as a matter of professional practice they should keep you informed and involved at all stages of the process.

Legal expenses cover isn’t any particular help in dealing with uninsured drivers either. The Motor Insurers’ Bureau was set up specifically to ensure you don’t lose out in any accident situation if the other driver is uninsured.

Most basic policies now say they’ll cover you if you have to deal with an uninsured driver — as long as you get the registration number and identification of that driver. Your legal expenses cover adds nothing. The same standard “reasonable prospects of success” applies. Your insurers won’t take action against the Motor Insurers’ Bureau unless their test is satisfied. Again, you’ll get this kind of service from any reputable personal injury lawyer without having to buy an insurance add-on.

But what if you’re the driver at fault? Don’t you need legal protection?

You do — but protection from the perils of civil litigation is already included in your main insurance policy.

You don’t need any extra cover which adds nothing to your existing protection.

When you’re at-fault your own insurers will be falling over themselves to deal directly with the non-fault driver. They will want to close off the case as fast as possible to minimise the costs and expenses associated with your claim. This is called “third party capture” which you can find out more about in Chapter 5.

In this situation, they’re not capturing you, they’re capturing the driver or people you’ve injured and who will be dealt with directly by your insurers.

And what about protection from criminal prosecution, and support if you are accused in a road traffic complaint?

You’ll find most legal expenses policies don’t cover this because it will be a pure expense for your insurers with no prospect of recovery from any other person or other insurance company. Once again you’ll find your main policy will deal with this.

Your insurers don’t want you found guilty of any road traffic offence, because that will tend to increase their exposure to third parties. A criminal conviction against you will greatly undermine your own insurer’s negotiation position when they’re trying to minimise and settle the claim against you.

Courtesy car add-on

The courtesy car add-on typically costs between £15 and £25 per year. When the CMA examined this cover it found your general insurance policy usually provides a courtesy car.

There may be some advantage with the add-on if you want an “enhanced courtesy car”, meaning a car either of better quality, or at least the same quality, as your own car. This is an improvement on the basic cover.

So if you drive a high-end Range Rover you may wish to consider taking out an enhanced courtesy car add-on.

Most insurance policies describe a standard courtesy car as a small three-door hatchback with 1 litre engine. An enhanced courtesy car is a five-door car with an engine size of at least 1.6 litres, with room to seat 5 people.

Breakdown cover

Breakdown cover costs between £25 and £70 and will usually be provided by a third party, generally a body shop repairer or garage. It means what it says.

If your vehicle breaks down a qualified engineer will attend. If they can’t fix your vehicle they’ll take it to a garage repair shop. This cover may be important for you, but you should check you don’t already have it for example with AA or RAC membership.

When it comes to renewing with the AA or RAC ask your insurers to quote for breakdown assistance. AA membership can now cost over £200 per household and you should be able to negotiate a similar level of cover much more cheaply from your insurance provider.

Personal injury cover

Personal injury cover add-ons usually cost between £15 and £27. It will cover you for your injuries and loss of earnings even where the accident was your fault.

But check you don’t already have this cover with your household contents policy.

Your main motor insurance policy will also contain some kind of personal injury cover, but it tends to be very basic. I’ve seen policies which offer a maximum of £2,500 if you lose the sight of both eyes.

So if you are a very risk averse person, you might think it worthwhile to take out the add-on.

GAP insurance

Very many of us now buy new cars on loan or lease deals. GAP means “Guaranteed Asset Protection”. It’s a safety net if your car is a write-off after an accident.

GAP insurance is a specialist product and your main insurer probably won’t offer it to you when you buy your insurance. But if you are buying a new car and are taking out any kind of loan or lease finance you should look into it. There are two main kinds of GAP insurance:

  • Finance Gap insurance
  • Return to Invoice insurance

This cover has come into existence because of the truly staggering rate of new car depreciation. Many new cars will lose 60% of their value after just three years.

If you’re paying for that car on a finance deal and you write it off, you may find you owe a lot more to the finance company than the write-off amount you receive from either your own insurer or the at-fault insurer.

You don’t have any legal right to be indemnified against this shortfall, and you could be out of pocket by thousands of pounds.

Return to Invoice means your insurance payout will be increased to match what you actually paid for the car.

A Finance Gap policy covers the difference between what you receive as the write-off value and the amount you owe to the finance company.

Previously, car dealerships pressured customers into taking this cover when they bought the car and typically added a hefty commission. The Financial Services Authority has clamped down on this practice.

As a rule of thumb, you should remember any time you buy from a middle man there will be a commission involved. You should check out a specialist provider.

Do you really need GAP insurance?

It’s highly unlikely your car will be so seriously damaged it will be written off. Particularly if you’re buying a new and expensive model — it will almost always be economic to repair.

There’s also likely to be a clause in your core policy stating your comprehensive insurers will replace any new vehicle if damaged beyond repair within the first 12 months. But GAP cover from a specialist provider isn’t particularly expensive (for example, you’d pay around £80 for three years’ cover from ALA).

So if you’re of a nervous disposition you should consider GAP insurance when buying a new car on loan or lease finance.

Action Points

Your insurance policy is a legally binding contract and your insurers will take any chance they can get to wriggle out of paying your claim. So here are my top tips for keeping yourself and your money safe:

  • Be scrupulously honest when you’re providing information — down to every last detail
  • Make sure you update your insurance company for any change in circumstances or vehicle, no matter how small and insignificant it may seem
  • Beware fronting: they will find you out (fronting is putting a risky driver’s car in a non-risky driver’s name)
  • Read your policy documents thoroughly — they’re not difficult and it won’t take long… and it could save you a small fortune
  • Double and triple-check you’re actually insured to drive other cars — even if the owner has given their permission (remember Mr Yousaf)
  • Be aware you may only be covered third party if you’re driving someone else’s car — so if you’re at fault in an accident, you won’t be able to make a claim
  • Make sure you ask your insurer for your no claims discount amount — they must tell you if you ask
  • Remember: the no-claims discount protection add-on may not protect your cash at all — it doesn’t stop insurers from raising the basic premium, so if you’re risk averse, you might consider the enhanced protection add-on
  • Consider taking out GAP insurance if you have a brand new car — or you could find yourself thousands of pounds out of pocket if you write your shiny new car off

Now you know how the insurance industry really works, you’re in a great position to make sure you get the best deal. But how do you do that? Chapter 2 will show you how to make sure you don’t get ripped off.

Remember: your insurance company doesn’t see you as a person. It sees you as a cash machine. And it will always put its own best interests first.

You need to make sure you put your best interests first — and to do that, you need someone who knows the insurance industry inside out.

If you, or someone you know, is involved in an accident don’t leave things in the hands of your insurance company. To them, you’re a number and they want to close off your case as soon as possible.

To me and other conscientious independent lawyers you’re a human being who deserves a fair deal.

If you’re involved in an accident and there are injuries, get in touch with me immediately for a no-obligation chat:

  • Call: 0800 612 4151
  • Email: info@accidentlawscotland.com

[1] “No fault claims adding 30% to car insurance AA finds”, The Guardian, April 16, 2014.

[2] “Motor Legal Expenses Insurance. Consumer Market Research.” February 2013 Financial Services Authority.

Navigating the insurance minefield

This book isn’t a “do it yourself guide”. You can’t do it yourself, you’ll have to work with and co-operate with some organisations.

But it is a “know it yourself” guide, with the aim of arming you with the “Secret Insider” knowledge you need to make informed decisions in your own best interests.

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If you’ve suffered any kind of personal injury in a car accident, whether as driver or passenger, let me make something very clear to you at the outset: the at-fault insurer is not on your side.

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