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Why car insurance is mandatory

Under UK law, it is an offence not to have at least a third party car insurance policy, but why is this the case? If you want to know why car insurance is mandatory, read on to discover more.

What is car insurance for?

The primary purpose of car insurance is to protect the financial and medical interests of people who experience accidents involving vehicles. You might think that if you damage your car then it’s your own business and your own problem, but the fact is, the majority of accidents involve other parties.

If you cause the crash – for example by driving too closely behind the car in front, and colliding with them in the event of an emergency stop – then who pays for the damage to their car?

The driver responsible for the crash is liable for the damage. If that is you, then how would you pay for this? Imagine you collided with a very expensive car, and you could be hit with a bill to repair or replace that car. Such a bill could cost tens of thousands of pounds, so how would you pay such a sum?

Car insurance is the answer. When you take to the roads, you need to be covered for this eventuality – as does the other driver. If no one else was using the road but you, then perhaps you would not need car insurance, but the reality is that roads are getting busier and this brings an increased risk of accidents.

Types of insurance

You can choose from three different kinds of car insurance, which are detailed as follows:

Third party

The minimum cover you need is third party only car insurance. This covers you if cause damage to another party’s property or you injure them while driving. It covers your passengers as well. 

Third party, fire and theft

In addition to the third party cover described above, third party, fire and theft policies cover your own car if it’s stolen or sustains damage caused by fire.


Fully comprehensive cover protects your own car, as well as that of third parties. So, if you have an accident and your car needs to be repaired or replaced, the comprehensive cover will pay for this – even if it’s your fault. 

A range of extras can be added to a fully comprehensive policy. Some of these may be included as standard, while others require you to pay more. This varies according to the insurer, so it’s worthwhile comparing the levels and features of cover that different providers offer.

What if I don’t have insurance?

Failing to have car insurance is an offence and can lead to serious consequences. You could face a fine and penalty points on your driving licence. Ironically, this will also make your insurance more expensive in future too.

The worst case scenario is that your case goes to court, which means you could face an unlimited, means-tested fine. Your driving license could also be revoked.

How do I check if a car is insured?

If you want to make sure that your car – or perhaps someone else’s – is insured, then you can do this very simply by inputting the registration number on the Motor Insurer’s Database (MID). You can find out if the car is insured for free, while payment of a small fee can give you access to policy information as well.

It’s estimated that over a million drivers in the UK do not have motor insurance, so make sure you’re not one of them. Getting appropriate cover is required by law, and it will help to protect your finances.

Other related FAQs

Looking for more related content to this? We’ve picked a selection of related topics that you may find helpful

Yes, your no claims bonus (NCB) can expire – and will do so 2 years after your last car insurance policy comes to an end. If you want to make sure you keep your NCB, you’ll need to take out a new policy within 2 years.

Motor legal protection is an optional extra that can help cover the cost of legal expenses that might be needed if you’re involved in an accident that’s not your fault.

The majority of UK car insurance companies will automatically renew your cover when it ends so you don’t accidentally end up uninsured. By law, your provider must notify you that your insurance will renew – and they must show you last year’s price too – so you can decide whether you’re getting a good deal.

Yes, it is possible for two car insurance policies to overlap. This can happen when you switch to a new policy with a different provider before your previous policy has come to an end.

Yes, car insurance can be paid monthly. In fact, many people pay for their car insurance by monthly instalments.

Don’t panic if you can’t remember who your car insurance is with. The best way to find out is by checking your paperwork – but if you don’t have it to hand, you can look at who your monthly payment is made to through your banking app or search your emails for electronic copies of your documents.

It’s important to keep track of car insurance expiry dates – so you never find yourself driving without adequate cover. To find out when your insurance ends, you can check your paperwork, call your provider, wait for your renewal notice to arrive, or check the Motor Insurance Database.

The vast majority of insurance companies will let you choose between paying monthly or yearly for your policy. Your policy will therefore expire at midnight on the expiration date, unless your policy auto renews.

As long as you have made a Statutory Off-Road Notification for the car in question, you don’t need SORN insurance – but you might decide you want to insure it; depending on your circumstances.

Third party car insurance is a type of cover that only pays out for damage caused to other peoples' vehicles if an accident is your fault. Damage to your own car is not included.