When the time comes to renew your car insurance, you would be forgiven for finding it difficult to navigate the number of deals out in the market. Many insurers offer a range of policies, which contain different benefits and come with different price tags. One thing you should consider is the type of insurance cover which would be most suited to you. In the market today, there are generally three types of car insurance offered by the majority of the insurance companies. These are; third party only, third party fire and theft, and fully comprehensive insurance. Each type of cover offers a different level of protection against accidents and incidents such as fire damage. This article aims to explain the difference between the policies, and what is covered in the event of a claim.

The cheapest option is third party car insurance, although you should be aware that not all insurers offer this kind of protection. It is basic cover for any third party, in the event of an accident, and will provide protection for any passengers in the vehicle and other vehicles involved in the accident. It does not cover the driver or the car itself. For example of how this would work, consider two cars each with a driver - Car A + Person A and Car B + Person B. Person A has decided to insure their car with third party insurance and is out on the roads, when he drives into the back of Car B. As person A is at fault in this situation, it would be his insurance that would need to pay for any damage, or injuries incurred by the accident. Person A's third party insurance would cover the damage caused to Car B and any treatment for injuries for Person B. It would not cover the repairs for any damage to Car A or any treatment for Person A should he require it. In addition to this third party insurance would not cover any incidents of fire or theft. As you see, this is very basic cover and it is recommended that this option only be chosen if the value of the car to be insured is approximately £1000 or less. It is not recommended for inexperienced drivers or high value vehicles.

Third party, fire and theft is the next insurance cover option. This type of insurance offers the same level of cover as third party insurance, with the addition of extra cover to protect against fire or theft of the car. Typically third party, fire and theft insurance is not that much more expensive than third party cover, especially if you keep the vehicle in a garage or on a drive way over night and reside in a low crime area. It is therefore often worth paying the little bit extra in order to have the benefits of enhanced protection. However if you have made any modifications to your car, you may find that third party insurance will work out a lot cheaper. This is because statistically, cars once modified tend to be more attractive and therefore are more likely to be stolen. Modifying a car can also increase its value significantly, and therefore there is a higher cost to the insurance company if it were to be stolen. Cars valued at less than £1500 are typically suited to a third party, fire and theft policy.

The third and final level of cover is fully comprehensive cover. Fully comprehensive car insurance policies cover pretty much everything and everyone in the event of an accident, theft or fire. Looking again at the example above of the accident caused by person A driving into the back of person B; if person A was insured with fully comprehensive insurance their cover would pay, not only for the damage to Car B and any injuries sustained by Person B but also any injuries and damage to Person A and his car.

In addition to this the insurance company would pay out the current market value of the car, should it be stolen or damaged by fire. The car will also be covered in case of accidental damage caused by yourself or other parties and any passengers would be protected under the cover as well. In today's competitive insurance market there are many companies offering fully comprehensive insurance so it is worth hunting around to find the best deal. Many insurers offered added incentives with their fully comprehensive insurance cover to entice new customers. These incentives can be things like, a free courtesy car while yours is in the garage being repaired, legal cover or a protected no claims bonus scheme. Fully Comprehensive cover is recommended for cars valued at more than £1500. Be aware, that if a car has a value of over £3000 the majority of insurers will only offer a Fully Comprehensive policy.

The three levels of car insurance provide an element of choice to consumers to meet their insurance needs. However it is worth noting that when choosing car insurance cover, it is not always a better deal to take a lesser cover such as third party to save a couple of hundreds pounds. If you car is stolen or damaged by fire, the costs you have to pay could be high. At the same time, it is not worth taking out fully comprehensive cover unless it is really required. When trying to decipher which is the best level of cover for you, a good idea is to look at the policy excess and how much the policy is for the different levels and work out which one will offer the best value and protection in the event of an accident, fire or theft.