Car insurance myths busted

Sort out the car insurance facts from the fiction and make sure you aren't overpaying for your policy.

Alice Lloyd
Alice Lloyd
Updated 24 September 2019  | 5 min read

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It’s very easy to get paired up with a policy that’s too expensive or doesn’t support you with the cover you really need, because the car insurance industry is swaddled in confusion and jargon.

Infuriatingly, there's conflicting information everywhere you look.

We’ve sorted out fact from fiction with our guide to car insurance myths and realities. Give it a read before you choose a policy.

1. Third party policies are cheaper than comprehensive cover

False. The cost of car insurance, whether third party or fully comprehensive, is calculated using your information, driving habits and history. If you’ve got lots of experience and many years of no-claims bonus (NCB), a fully comprehensive policy can be just as cheap - and sometimes cheaper - than third party only or third party, fire and theft.

But there are a whole host of contributors to price, many of which are outside of your control.

For instance, if your quote for a third party only policy is very expensive, that insurer may receive a high volume of claims made by its third-party only customers which pushes up the risk factor and price.


2. If I stick with my existing insurer, I’ll get a loyalty discount

False. It’s rare to be rewarded for staying with your insurer - it’s more likely letting your insurance auto-renew will cost you more. It’s always worth shopping around and comparing policies to see if you can save.

If you've got a better price elsewhere but still want to stay with your existing insurer, make contact and ask for a price match - if you don’t ask, you’ll never know.


3. If I go direct to the insurer, my insurance will cost less

False. You might think you can save a few pounds and some time by cutting out using a comparison website.

We don’t charge you anything for our service and we don't add fees or commission to your quotes. Instead, we charge the insurer.

A good shop around includes using comparison sites and going direct to the insurer - it's not just about getting the cheapest price, rather finding the cover you need at the right price.


4. Your insurance is invalid if you drink and drive

It depends. Your car insurance won't necessarily be invalid if you're drink driving. However, if you've been in an accident whilst driving under the influence, your insurance company could refuse to pay out for your repairs or injury claims.

Under the Road Traffic Act, insurers must meet the costs of any claim by a third party for injury or damage. Be warned though - the insurer’s entitled to claim these costs back from you.

Most insurance policies will have a drink and drug driving clause. Make sure you check your policy documents to find out what you're covered for.


5. It’s okay to put mum as the main driver, and me as the named driver, on her policy

False. This is a tempting way for young or inexperienced drivers to reduce high insurance premiums. But don’t do it - it's actually a type of fraud known as fronting and could lead to the policyholder being prosecuted.

There are honest ways of reducing your premiums. A telematics policy or adding a more experienced driver as a second driver can help.


6. If you have fully comp car insurance, you can drive any car

Maybe. Many motorists believe that they can drive a friend’s car so long as they have their own comprehensive insurance, but lots of policies won’t allow this.

If you want to drive someone else's vehicle, check with your insurer first and make sure you’re covered to drive other cars, because you may find there is some cover, but it’s only in place for emergency use.


7. If you get a speeding ticket, your insurance premiums will go up

Maybe. An initial three points for a minor speeding offence won’t necessarily increase your premiums, or at least not by that much. What will have an effect is if you don’t learn from it and notch up more offences.

Be honest with your insurer. Not telling them about points on your licence will invalidate your policy if you later need to make a claim.


8. Older cars are cheaper to insure

Sometimes. Older cars can be cheaper because they tend to be worth less. But older cars can also be easier to break into, without the sophisticated alarms and mobilisers fitted to newer vehicles - which pushes insurance prices up

If you drive a classic car they can be cheaper to insure because you probably drive fewer miles each year and keep up with car maintenance. Some insurers also offer discounts to members of approved classic car clubs.

All vehicles fall into one of 50 insurance groups, based on things like car price top speed, the cost of replacement parts and security. Find out which car insurance group your vehicle falls into.


9. Insuring your car for business use will cost more

True. Business use insurance costs more. It’s because you’re more likely to drive a lot more, on unfamiliar roads or in heavy rush-hour traffic.

If you use your car for work, don’t lie about it. If you’re involved in an accident your insurer could refuse to pay out.

Read more about insuring your car for work use.


10. You can’t get insurance if you have a driving conviction

False. Some insurers will still insure you following a conviction for an offence such as drink driving. Some companies even specialise in high-risk drivers. Read more about driving convictions and car insurance.