The History Of Car Insurance

By Author: Gareth Hoyle
Total Articles: 692
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The history of car insurance can be traced back to 1895 in the UK when the first policy that provided liability cover was underwritten in England.*

Of course back in those days it was rare for people to own a vehicle, never mind have car insurance.

The first law concerning car insurance came into effect in the UK in 1930 and was introduced to ensure everyone driving on the roads at least had third party personal injury insurance.

Most recently the Road Traffic Act of 1988 was implemented to provide updated laws on car insurance and general driving issues.

Car insurance has changed considerably since its commercial inception at the end of the 19th century as technology has changed the way people get around.

Cars were once just available to the very wealthy, but there are now approximately 32 million cars registered in the UK alone.

Below is a list of some of the major changes in car insurance over the years.

" Different levels of cover

When car insurance was first introduced, it was all about providing third party liability cover. While this still exists today, there are ...
... now three main levels of car insurance cover; third party only, third party fire & theft, and fully comprehensive.

With so many cars on the roads now and the different lifestyles we lead compared to many years ago, it was necessary to give people more choice in their car insurance cover.

" Cheaper car insurance for certain groups

When car insurance was brought in as a legal requirement, there weren't cheaper policies around for different groups of drivers.

As time evolved and more women started driving, dedicated companies were formed specifically for female drivers. However, this is about to change again following an EU equality ruling which is being brought in.

Another group which generally enjoys cheap car insurance is the over 50s. As time has gone on and the car insurance companies have been able to gather more data on accident rates, the over 50s have benefitted.

" Performance based insurance

A more recent development in the world of car insurance is premiums based on the way a vehicle is driven. The Co-operative Insurance has developed a Smartbox system which feeds back data on how a car is being driven over a period of time. This information is then used to calculate the level of car insurance premium to be paid.