Car insurance ancillaries: Which do you need?

Insurers offer a multitude of add-ons to accompany your car insurance policy, but do you actually need them?
In the wake of around £215m having been paid out by banks for mis-sold Payment Protection Insurance (PPI), it’s clear we don’t like being sold things we don't really need, and car insurance is no exception.
When buying a car insurance policy we're faced with a selection of additional products to add on, so here's a run-down of the ones most commonly offered and how much you should pay for them so you can work out whether or not you need them at all.

Protected no-claims bonus

• What is it?

If you’re asked whether you’d like to protect your no-claims bonus (NCB), you can do providing you’ve earned four years. This generally allows you two fault claims within a three-year period without losing your NCB. Some insurers also offer Guaranteed NCB, which costs a little more but allows an infinite number of fault claims in a one-year period.
Spokesman for the British Insurance Brokers Association (BIBA), Graeme Trudgill, says that “most insurers will charge an extra 5 to 12.5 per cent of the total premium cost for NCB protection.”
If you choose to protect your NCB having only just reached your fourth year, the cost may be considerably more than that.

• Is it worth it?

Being involved in an accident will make your premium go up. Losing your NCB will mean further loss of discount and the premium will climb even higher. What was a £350 premium then has the potential to more than double, so this product could save you a lot of money if something was to happen.

Hire car

• What is it?

This add-on is different from the courtesy car, which is generally included in all fully comprehensive policies and only covers you if your car is deemed repairable by the garage.
The hire car benefit then, supplies you with a replacement vehicle in a total loss situation, so from the point your car is deemed a write-off or stolen until you receive your settlement, which can often take up to three weeks. This benefit usually costs between £20 and £30.

• Is it worth it?

In a word, maybe.
It depends on how heavily you rely on your car. If you live in a one-car household and rely on your vehicle every day, it may prove invaluable.
If, on the other hand, you have access to another vehicle or don’t rely heavily on your car, you can probably make do for a few weeks and save yourself a bit of money on your premium.

Legal cover

• What is it?

When an accident isn’t your fault, this helps you claim back any uninsured losses such as your excesses, alternative transport costs, loss of earnings and injury compensation.
On price, BIBA’s spokesman says that “you shouldn’t pay more than £20 for this, if not included in the policy as standard.”

• Is it worth it?

Yes. If you have an accident that isn’t your fault, it may still require further investigation and you’ll still have to pay your accidental damage excess. Legal cover means not having to fork out to get back anything that is due to you.

Personal injury cover

• What is it?

Additional compensation cover if the policy holder or any named driver were to sustain a serious injury or death whilst driving the car. There are terms and conditions that apply here, so check with your respective insurer.
Levels of cover and price will differ between insurers, but as a guide, you shouldn’t pay more than £30 and it may already be included in your policy.
BIBA’s Trudgill said: “There is often a level of personal injury cover already included in comprehensive policies, but many simply don’t know it’s there or forget to claim.”

• Is it worth it?

Many drivers will already be covered for serious injury or death through either life insurance or similar policy, sometimes offered by their employer, but it’s unlikely that a young person will have any such cover in place.
This then could be a welcome benefit to their policy. Equally, if you have a young driver named on your policy, you may do well having the extra protection in place for them.
Remember, this is a personal decision, so don’t be afraid to say no.

Know what you’re covered for

So when you’re car insurance policy is next up for renewal you need to think about:

• Which (if any) of these add-ons are included as standard?
• Which ones might you need?
• Which ones can you do without?

The main thing is to make sure you’re not pressured into paying for anything you don’t need, but that you get a level of cover you’re happy with.