There are three main types of cover available in the UK today:
1. Third party
As well as covering the insured person when driving on public roads, this type of policy also applies on private property. It covers third party claims and provides protection against other legal liabilities. Passenger indemnity, for example, provides cover against the possibility that a passenger in the car may cause an accident perhaps by carelessly opening the door and knocking a cyclist over. It also provides cover against certain legal costs.
2. Third party fire and theft
In addition to the protection offered by third party insurance, this type of policy also covers loss or damage to the insured person’s own car as a result of fire, theft, or attempted theft.
This is the widest form of cover available, although it cannot protect against every conceivable risk. In addition to the covers offered by third party fire and theft policies comprehensive policies also protect in other valuable ways. The most important of these is accidental damage cover. Comprehensive policyholders can have their own damaged vehicle repaired or replaced. These policies also include personal accident insurance, providing payments for death and specified serious injuries ‚ such as the loss of a limb or sight. Such payments are usually restricted to the policyholder and their spouse. Comprehensive policies may also cover small amounts of medical expenses cover for anyone in the insured car who is injured in an accident and for loss of (or damage to) personal effects in the car.