How to choose the best car insurance based on value for money

We offer you the key recommendations for choosing the insurance that best suits your needs and your pocket

Car insurance is one of the most useful services for a driver. It is a legal requirement to have an insurance policy in place and insurance provides financial protection if you have an accident.

The challenge is knowing which insurance policy, from among the huge variety on the market, is the best one for you. This is where value for money comes into play, although as we will see later on, in this case the value depends on our needs. The first thing you should do when looking for insurance is to ask yourself: what exactly do I need?

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More coverage does not mean better insurance

With car insurance, the amount of coverage is not as important as the quality of the coverage. There are very affordable insurance policies that offer excellent protection. However, before taking out these insurance policies, first check the indemnity limit. Let's have a look at the cover and indemnity limit of each type of insurance.

Third-party insurance

Third-party insurance is the minimum level of cover required and includes compulsory civil liability, legal defence and personal accidents of the driver. Even so, depending on the insurer, third-party insurance can also include other cover such as:

  • Travel assistance
  • Protection as a pedestrian and cyclist
  • Processing fines
  • Free choice of repair garage
  • Breakage of Windows
  • Vehicle theft and fire.

And here is where you should decide if it is the right insurance for you. Could your car be stolen or catch fire? Could you get a flat tire and find yourself stranded in the middle of the freeway? And what if a stone hits the car while you are driving and cracks the windscreen? Do you take the car out every day or just at weekends? Is the vehicle new or is it more than 5 years old? These types of questions can help you to make up your mind.

But what if you want more cover?

Comprehensive insurance

Not all comprehensive insurance policies are the same. Again, it is important to check the damage liability cover of the insurance. In this case, the key figure is the value that the insurance company assigns to the vehicle at any given time. If you have an accident resulting in a write-off of the vehicle (i.e., when the repair value exceeds the value of the vehicle at the time of the claim), how much compensation will you be entitled to?

Therefore, when choosing a comprehensive insurance policy, you should first find out how the insurer establishes the value of the vehicle. In this case, the equation is usually simple: the older the car, the less value the company assigns it.

The indemnity limit in comprehensive insurance policies also applies to other types of services and cover, including legal defense and a replacement vehicle. For example, in the event of having to go to court due to any accident, it is important to have good legal representation and the majority of comprehensive insurance policies have it. However, the limit of the attorney fees and other legal expenses can vary enormously from one insurance to another. You should also pay attention to that.

So, is it better to have a very complete third-party insurance or a more affordable comprehensive insurance? Again, it depends on the cover you need and your budget. We'll discuss this now.

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And choose the one that best fits your needs.

What does the price of a car insurance policy depend on?

Many factors help determine the cost of car insurance. Some of this we can choose, such as the cover, which we mentioned earlier, while other depends on our own characteristics as a driver: our age, how many years we have had a license, the cost of the vehicle we drive, the town we live in, etc.

In addition to these variables, there is also the possibility to take out the insurance with or without an excess. An insurance with an excess determines a percentage of costs or damages which the insurance will not cover in the event of a loss, hence we will have to cover that cost. For this reason, these insurance policies are more affordable than those without an excess.

Remember: the best value for money insurance that covers our needs

It is important to take out a car insurance policy that is right for you. For example, it is not advisable to insure a new vehicle with third-party coverage, since any damage to the vehicle can cause us a high financial loss if we don't insure it correctly. On the other hand, sometimes we keep the comprehensive insurance on very old vehicles and it is not cost-effective.

For this reason, before starting to search, dedicate some time to assessing what it is that you will really need from your insurance in the next few years.

And if you still have any questions, contact your insurance agent.

A good way to save on insurance is to group bills together. This is what is offered by services like the BBVA EstarSeguro Plan, which you can use to enjoy significant savings (of up to 15%) depending on the number of BBVA insurance products you include. Moreover, they offer other benefits such as the possibility to pay for the insurance policies month by month without any surcharges.

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