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Why you need to be very careful when buying low priced car insurance.

Bargain priced car insurance does exist. Buying the very lowest priced policy, though, is not always a good idea because insurers can be very good at charging for extras which can make an inexpensive policy into a very expensive one. A favourite ploy is to accept everything that the customer says on a proposal form, offer a low quote, accept payment and issue a cover note. A week or two later, though, a letter arrives asking for driving licence details and proof of any no claims discount that the applicant claimed for, to be provided within a week! If these are not produced or, worse still, the details do not match those on the application form a demand for a substantial extra premium with a threat of cancelling the insurance can be sent to you. If you are on holiday at the time and cannot reply, tough luck. If you do not provide the requested information in time or pay up you find the policy cancelled, and the insurance company keeps a large slice of the premium you have already paid. Can they do this? Yes, it's clearly written in the policy documents which, like most other buyers, you never read, trusting the insurer to act reasonably.

Or; you get past this hurdle but you change your job, change your car, move house, find somewhere else to park your car at night; or anything else which would normally alter a car insurance quotation. Did you know that you are obliged to tell your insurer about anything which would affect the premium, whether they asked for it or not? Fail to tell them and they can refuse to pay out on a claim, tell them all about it and even if your premium couldn't be increased they could hit you for a 'management charge' that could be in three figures, but which other insurers may not charge for at all. Can they do this? Read their documentation and you'll have your answer.

Oh, and even if none of these unhappy situations occur, will you be able to contact them in the event of a claim? Will they pay out quickly, and without quibbling?

So; buying bargain basement car insurance may be very desirable particularly for young drivers hit by huge premiums but before signing on the dotted line a few precautions are in order. First read through the documentation; insurance companies are obliged to make it easily available, and written in plain English. Check out reviews of the insurance company online; the most inexpensive ones are often the ones attracting the most complaints. See if the company is registered in England; a lot of companies from Gibraltar are authorised to offer car insurance in the UK and although some of them are excellent companies with good reputations some have received many bad reports from disgruntled customers. Few of these foreign insurers belong to the UK's Insurance Ombudsman Scheme and have you ever tried suing a company abroad?

Finding that bargain policy

Hopefully we haven't worried you too much because there are still bargains to be had. Many reputable insurers have special offers for new customers from time to time which can make their policies very reasonably priced indeed compared to other similar policies, but they don't give advance notice of them and they only last a short while. You can find many of them by checking a good price comparison site regularly, well before the renewal date of your current policy, if any; and when you find that very economical policy you can often book it to commence in the future at the current, competitive price. The bargains are there, but you have to spend some time looking for them!

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