The minimum level of cover in the UK is termed Third party only. This type of policy covers you for the cost of any claims for damage you cause to another person's vehicle or property. You are not covered for damage, loss or theft of your own car or possessions.

Third party, fire and theft is as above but also insures your own car for damage or loss caused by fire or theft. You are responsible for damage to your own car or possessions, apart from loss caused by fire or theft.

A comprehensive policy provides cover as in third party fire and theft above, and in addition damage to your own vehicle. The policy should be examined for exact cover and exclusions.

It should be noted that on third party fire and theft and comprehensive policies excesses apply. An excess is an amount for which you are responsible in the event of a claim.

Some policies have compulsory excesses, however many also have voluntary excess which reduce the price of the policy. The greater the amount of voluntary excess the greater the discount provided.