Car insurance: Car insurance: add-ons, fees and charges
Buying car insurance may be quick but it's not always simple, as many companies offer a host of add-ons (some of which may be already included in your policy) as well as having a number of fees and charges (some of which may not be clear when you buy).
But what are the common add-ons, fees and charges? And what should you look out for when you buy?
A courtesy car is a replacement vehicle provided by your insurer if your car is off the road following an accident. Some insurers will provide a courtesy car as standard, but this is usually under the condition that your car is fixed by one of its approved repairers.
Some insurers offer a courtesy car only if your car is damaged in an accident, not if it's stolen. Others charge an extra premium if your car is stolen or if your vehicle is a total loss.
Find out more: Best and worst car insurance
Legal expenses insurance
Legal expenses insurance covers the cost of legal action resulting from a car insurance claim. The insurance covers events that arise from using your car, which includes taking action against a third party for negligence, or defending accusations made against you.
Breakdown cover is often sold as an add-on and can cost up to £35. Breakdown cover can be extended for driving in Europe to provide cover on the continent. The extension can cost up to £20 and usually covers you for up to 180 days in the EU.
Find out more: Best Buy car breakdown cover
Personal accident cover
Basic personal accident cover is included as standard in most policies. However, you can pay around £20 to increase the benefit to £100,000. This can also be bought separately.
Find out more: How personal injury cover works
Windscreen cover, which is often included with a comprehensive policy, either repairs damage or replaces your windscreen.
Key insurance helps pay for a replacement if your keys go missing. The cover provided will also pay for replacement locks. Some providers will also offer 24-hour assistance.
Set-up fees and renewal fees
Set-up and renewal fees are relatively rare and are usually charged by online brokers. 1st Central, for example, charges £50 for both new business and to renew the policies of existing customers
Having to change your policy is likely to cost you. Amendments can range from changing the name on your policy (if you get married for instance) to adding a second driver. The fee could be as high as £35 and this is on top of any increase in premiums caused by the changes.
Cancellation and ‘cooling-off’ cancellation fees
If you decide you no longer want your policy, even within the 14-day cooling-off period, your insurer may charge you a fee. Under the law the fee has to be ‘reasonable’ but can still vary greatly from provider to provider. IGO4, for example, charges £75 if you can cancel at any point, but Age UK lets you cancel for free.
Pay monthly APR
Paying monthly for your car insurance may seem like a good way to spread the cost but can prove expensive. Paying monthly means taking out a high interest loan from your provider – sometimes with APRs as high as 40%.
|10 Best For Fees|
|Provider||Credit Card Fee||APR||Policy adjustment fee||Duplicate document fee||Cancellation fee [a]||Renewal Fee||Cooling off cancellation fee||Which? fee score|
|Quote Me Happy||1.5%||Varies||0||0||£59.95||0||£29.98||74%|
|10 Worst For Fees|
|AXA||2% up to £9.99||Varies||0/£10||0||£52.50||0||£30||59%|
|Swiftcover||2% up to £9.99||Varies||0/£10||0||£52.50||0||£30||59%|
|Additional Which? Recommended Providers|
Which? Limited (registered in England and Wales number 00677665) is an Introducer Appointed Representative of Which? Financial Services Limited (registered in England and Wales number 07239342). Which? Financial Services Limited is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited. Registered office: 2 Marylebone Road, London NW1 4DF.