UK Motor Insurance – Policy Clauses

The clauses within your car insurance policy document are the place where the insurer typically limits or lessens their liability within your policy. You should read them carefully in order to understand what is covered and what might not be.

Policy Clauses – Trailers & CaravansĀ 

The purpose of this section is to cover you for your liabilities when towing a trailer or caravan. In other words it is ‘third party only ‘ cover irrespective of the cover you have on your car.

Caravans are usually provided for on this basis. So if, through your negligence, your caravan comes adrift from your car and causes other damage or injury this policy will protect you for those sums of money you have to pay as compensation.

Needless to say, the type of cover here varies from one insurer to the other. Some will give you ‘comprehensive’ cover for your small, single axle trailer for a small extra premium. Make sure your trailer meets the specification in this area of cover.

Policy Clauses – Emergency Treatment Fees

Under current UK legislation, you must pay fees to the first medical practitioner to give you treatment in an accident. This is incorporated in the Road Traffic Act.

Some people call this a charge for an ambulance. Strictly speaking this is not correct but in practice it is usually the ambulance paramedics that provide the medical treatment and the account comes to you from the N H S Trust that supplied the ambulance and its crew.

YOU MUST PAY THIS BY LAW irrespective of who was to blame for the accident. Your insurer will meet the cost under this section. Just send the account into them and they will pay it directly to the N H S trust. Or pay it yourself and ask your insurer to reimburse you.

Occasionally in a busy insurance office, the claims staff can overlook the account if you have sent it in with other papers. Indeed you might receive a reminder from the N H S trust. Tell the N H S Trust who your insurers are and telephone your claims office. Be firm but please don’t be angry.

Payment of this account in itself does not affect your no claims bonus. It is not regarded as a claim. So, in the unlikely event your insurers were to pay this and nothing else your bonus remains intact. But in an accident where someone is injured, it is unlikely there is no other types of claim to be met.

Technically, if someone else is to blame for the accident you can send this account on to their insurer but you are just asking for unnecessary hassle. My advice is, don’t bother. It makes no difference to you either way.

Owing to recent changes in the law, hospitals now also charge insurers for treatment given to victims of accidents, with certain limits applied. These are paid to the hospital in cases where you have been negligent and someone else has had treatment for the injury you caused. THIS HAS PUSHED UP THE COST OF CLAIMS SETTLEMENTS AND CONSEQUENTLY YOUR PREMIUMS.

Some insurance professionals consider that this is a further case of “stealth tax” taxation by the Government.

Policy Clauses – Personal Injury and Medical Expenses

This is limited personal accident insurance and is very similar to those free certificates you sometime now receive with the ‘junk mail’. It is very simple. If you, or your partner are killed in an accident, or lose a limb or an eye whilst in your car, you (or your estate) will receive a lump sum, irrespective of who is to blame for the accident.

The amount you receive is specified in the policy wording. There is ‘small print’ relating to self inflicted injury, drugs and drink and so on. If you need this sort of protection then I suggest you look into a proper personal accident policy or find out about a suitable life assurance product.

Claims staff sometimes forget about this part of the policy. So if you are entitled to claim on this section, remind them!

Some comprehensive policies provide for limited private medical expenses. Very few claim, but then the amounts covered are so small that you would not be able to buy much treatment for the cash available. If someone else was responsible for the accident then you could obtain private medical treatment and submit this as part of your uninsured losses.

Policy Clauses – No Claims Discount

Often called a no claims bonus, the NCD is very popular. It has been around for decades and some people can get very upset about it. Indeed, there can be a lot of money at stake.

All insurers have scales which make your premium cheaper the longer you go without making a claim, until you reach the maximum on the scale. This is often 65% or sometimes 70%. Every insurance company scale is slightly different. The bottom line is: what is the premium I have to pay? A 65% discount with one insurer might work out a better bet than a 70% with another insurer.

A few years ago, free ‘protection’ was introduced but if you want to protect your bonus now you have to pay an extra premium. Whilst the scales and the details of the schemes might vary from one insurer to another, the claims aspect is essentially the same. It is a No Claims discount, NOT a no blame discount.

Claims staff will ‘allow’ your bonus, that is, keep it intact, if they make a full recovery of their outlay. It is as simple as that.

So if your car is stolen and no money is recovered from the culprits, tough! You will lose your discount – you have made a claim and received the benefit of your policy.

If your car is damaged by a ‘hit and run’ driver, tough!

If the accident was partly or entirely your fault, tough. Your insurers will have paid out and protected your interests but you lose your bonus.

Subject to any protection you have on your bonus and how this works on your policy, one claim will usually step back your bonus rather than reduce it to nil. But make more claims and……….you’ve guessed the rest.

One final point to bear in mind, when your renewal comes up and you receive the bad news about your renewal premium, most insurers will allow you to repay the claim if this is a cheaper option.

Policy Clauses – Driving AbroadĀ 

This part of your policy tells you what cover you have when you go abroad. Usually, if you are going to the European countries listed, you do not require a ‘green card’ and you will have the full policy cover without additional premium.

For other countries, a Green Card is still required and you will need to pay additional premium. Before setting off, speak to your insurer and make sure you are covered.