Cheap car insurance doesn't have to mean insufficient cover

Car insurance is one of those products you're legally required to buy, but which you hope you never need to use (in terms of having to make a claim). If you do need it, however, you'll want it to work properly and ensure that it covers all of the loss or damage that you expected it to. The worst discovery to make is that, despite all those monthly premiums you will have paid, when it comes to the crunch, some vital aspect remains uninsured or underinsured. For this reason it's important to be reassured that cheap car insurance doesn't have to mean insufficient cover.

As with many of the things we buy, cheap car insurance is less about finding the very lowest price we can pay than it is about paying the best price for what we actually get. In other words, it's about getting the best value for money. In car insurance terms, this could be seen as getting the maximum amount of cover for the lowest-priced premium.

This type of search, therefore, involves a careful balancing act between the premiums you are prepared to pay and the cover you need. In these days of the internet, thankfully, the balancing act can be made considerably less precarious by using an online insurance comparison website where you can compare not only the costs but the policy features and benefits of many competing insurers.

When making such comparisons and looking for the policy that represents good value for money, you might want to bear in mind some of the following factors:

Type of insurance - whether you choose third party cover only; third party, fire and theft; or a comprehensive policy will naturally determine the price you pay. Third party insurance is the least the law requires you to buy in order to drive. The minimum level of cover poses far few risks to the insurance provider of having to pay out than if you had comprehensive cover. This means your premiums will probably be cheaper. However, if your new car is worth £15,000, are you really prepared to run the risk of losing it all if the car is written off following an accident? The cheap choice in these circumstances would have left you with insufficient cover, so it's worth carefully considering the insurance type that's right for you and your vehicle.

Excess - share the risk with your insurer and the premiums are likely to be cheaper. Most car insurance policies will offer a "voluntary excess" - in addition to a standard "compulsory excess" - by which you take on a larger share of the risks by paying more of the first part of any claim. Although the insurance will be cheaper, you may find the cover insufficient unless you can afford to pay the full amount of the excess in the event of a claim;

History - car insurance, of course, is all about insuring the risk of you damaging your own or someone else's vehicle or property or causing injuries or death to a third party. In assessing this risk, the insurer may scrutinize your record of past driving infractions and claims history as an indicator of your likelihood of having an accident in the future. Careful drivers, with few or no claims, therefore, will be rewarded with cheaper premiums;

You - insurers will also take into account a number of things you cannot change or will be very unlikely to change in order to buy cheaper car insurance. Your age, your gender, your occupation and your residential post code, for example, are likely to influence the price you pay for the cover you are offered. Although the individual driver will be at the mercy of such personal circumstances, it certainly remains the case that, in many other respects, cheap car insurance doesn't have to mean insufficient cover.