Car Insurance Information
How Premiums Are Calculated
(back)
How Premiums Are Calculated
Factors taken into account in costing your insurance
include who will drive, the type of car, where it is kept,
the uses to which it is put, and the type of cover required.
When buying motor insurance you must give the insurer
full information.
Drivers
The policy may only cover driving by yourself or specified
people, or it may allow driving by any qualified person
with your permission, possibly over a certain age limit.
Your insurers will want to know about anyone who is likely
to drive - particularly their age, experience, driving
record and occupation.
Your Car
Family cars with moderate repair costs are cheaper to
insure than large or powerful cars which can be expensive
to repair. Each model is given an insurance group rating.
This system is described later in this Information Sheet.
Older cars often attract discounts from comprehensive
insurance premiums.
District
Insurance claims are more frequent in urban areas so motorists
in cities usually pay more for their insurance than those
who live in the country. The place where the car is kept
is a rating factor, so tell your insurers if the car is
not kept at your home address.
Use
Your policy and certificate set out the uses for which
your car is insured. For example, if you or any authorised
driver want to use your car in connection with work, make
sure that your policy covers this.
No Claims Discount
Policyholders with a claim free (not blame free) record
normally qualify for a premium discount. Scales do vary
but usually range from 30% for one claim free year up
to 60% or more after four or five years.
"Protected Discount" policies are often available for
motorists with maximum discount. For an extra premium,
a number of claims are allowed without affecting the discount.
Typically two claims are allowed in a three to five year
period.
