Motor Insurance – Some Frequently Asked Questions
Why do I need motor insurance?
Motor insurance protects you as a motorist against liability in the event of an accident that you may cause. Motorists are legally obliged to have motor insurance under the Road Traffic Act, 1961.
How much do I need?
Motorists are legally obliged to have motor insurance under the Road Traffic Act, 1961.
- At a minimum you are required to have third party cover. This protects you against liability in the event of you injuring a third party, including passengers, or causing damage to their property.
- Third party fire and theft provides third party cover together with cover against damage to your own car as a result of fire or theft.
- Comprehensive cover not only provides protection against liability to a third party but also offers protection for fire or theft plus accidental damage to your own car.
What about optional extras - what can you typically expect to find on offer from motor insurers?
Optional extras vary from company to company. Extra benefits can include: No Claims Bonus Protection, windscreen cover, damaged / stolen personal items, emergency/recovery service, cover for a rental car in the event of your own car being off the road.
Is it important to reveal all details to an insurer?
It is vital that you disclose all relevant information to an insurer when initially purchasing or renewing your insurance. Otherwise, the insurance policy you purchase may subsequently be deemed null and void. If you are unsure whether certain facts are relevant, you should disclose them to the insurer and it is then up to the insurer to decide.
How are premiums calculated?
A combination of factors are taken into consideration by insurers when rating a risk. The key ones are as follows:
1. driving experience (including whether an individual has a provisional or full license);
2. claims experience/history;
3. geographical location;
4. type of car;
5. age of car;
6. your age;
7. occupation/ what you use your car for;
8. Level of cover required.
What is a no-claims discount and how does it work?
Insurers typically offer a premium discount for motorists with a claims free record. Policyholders are typically awarded a percentage discount on their premium on a sliding upward scale for each year of claims free driving up to a maximum of five years. The increased percentage discount awarded for each year can vary from insurer to insurer. However, it’s a no-claims discount, not a no-blame discount. Once you or a third party make a claim against your policy (even if you are not to blame for the accident), your discount will be affected. You will be able to rebuild your discount if no subsequent claims are made.
Most insurers will offer you the option of purchasing protection for your no-claims bonus. This means you may be allowed to make claims without fully losing your no-claims discount.
Is there anything I need to do if I want to take my car abroad?
Firstly, you should contact your insurer and advise them that you wish to take your car abroad. Normal terms and conditions of motor policies allow a policyholder to take his/her car abroad for up to 31 days to another EU member state for no extra charge. Your existing cover can be extended for stays of up to 60 or 90 days duration but you may have to pay an additional fee for this cover. After your extended cover expires, you have the minimum cover required by law in each country visited (i.e. no comprehensive or fire and theft) until your policy is due for renewal.
What should I do if I am involved in an accident?
If you are involved in an accident, keep calm and try to get as much on-the-spot information as you can.
Swap information – name, address, telephone numbers and details of your motor insurance with the other people involved in the accident.
Make a note of the registration number and the make and model of other car involved in the accident.
Take the names and addresses of any witnesses and if you have a video or a camera handy, take pictures before the vehicles are moved.
Notify the Gardai immediately of the accident.
It is a condition of your motor policy that you contact your insurance company as soon as possible while the details are still fresh in your mind. Ask your insurer for a claim form and when completing it include as much information as possible.
What can I do if I am unable to obtain motor insurance?
Insurance Ireland operates a Declined Cases Agreement, which is adhered to by all motor insurers in Ireland.
Under the agreement, the insurance market will not refuse to provide insurance to an individual seeking insurance, if he/she has approached at least three insurers and has not been able to obtain cover from them. In general, the insurer first approached will be required to provide the individual with a quote. It is therefore important that the proposer keeps a careful note of the order in which he/she approached each of the three companies.
Where an individual has held a policy within the previous three years, the insurance company concerned is obliged to provide the individual with a quotation. Again this is subject to the proviso that refusals have been received from three insurers (of which the previous insurer may be one).
The only grounds on which an insurer can refuse cover are where to provide insurance would be contrary to public interest.
The agreement is administered by a Committee made up of representatives of each of the companies who have signed the agreement. The Committee also includes a representative of the Consumers’ Association of Ireland and the Financial Services Ombudsman’s Bureau as external observers. If it is impossible to identify which insurer was the first approached for a quote, then a rota of insurers comes into effect and the Committee allocates the risk to the next insurer on the rota.
The Committee can also decide whether a quote is so high or the terms so excessive as to make the quote tantamount to a refusal, in which case it will review the matter.
For assistance regarding the Declined Cases Agreement, contact the Insurance Ireland’s Insurance Information Service - firstname.lastname@example.org
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