Read Your Car Insurance Policy Wording Carefully before you Buy On-line

Before you purchase car insurance online you should carefully study and read the policy wording, often found in a policy booklet or policy document downloadable as a pdf file from the Car Insurer.

The Policy describes the insurance contract that you are entering into when you purchase the cover, although it is not legally the full the contract itself.

A policy document, often refered to as 'the small print' will outline the contractual participants, the coverage, the consideration or what each party is liable to pay for, the events leading to compensation available under a claim, and any special terms and conditions, the t's and c's which apply to the contract.

In the case of dispute with or a repudiation by the motor insurer following an accident claim, the detail of the policy wording may be subject to variable interpretations by the civil courts.

Every Car Insurance policy document will contain five types of clause.

The first is known as the'Recital clause' which is responsible for determining the car insurance cover and specific exceptions. it is often split into multiple sections if more than one type of cover is offered, for example, third party or fully comprehensive or third party fire and theft.



A policy will also contain an 'Operative clause' which sets the scope of the cover and specific exceptions. This may be divided into sections if more than one type of cover is included. The 'Attestation clause' authorises the policy by the signature of the underwriter or the Car Insurance company CEO, whilst the 'General exceptions' clauses set out the general exceptions to the cover provided. Finally, the 'Conditions', which are often the most legally contested lists express conditions in order to define or limit the contract.

Policy document wordings for Motor and Car Insurance are often extremely complex and difficult for the public to understand. To help with this many Car Insurers will now produce a summary of cover or keyfacts document, to assist policyholders to understand the insurance protection provided, but unfortunately and legally these summaries do not cover everything in the policy.

Some Car Insurers have, therefore, tried to simplify the wordings themselves. There are dangers in this area since the traditional car insurance policy wordings have been well tried and tested in the courts with known outcomes, whereas simplified translations are unproved and may bring in areas of uncertainty as to the actual levels cover being offered and provided.

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About the Author

Dave Healey

Dave Healey is a leading UK specialist motor underwriter and Car Insurance journalist who regularly contributes to the Car Insurance Blog ..