Your guide to buying Car Insurance

Car Insurance Costs

Buying car insurance can often seem complicated and a little bit scary, there’s a lot to take in, but what does it all mean? We have collated some of the frequently asked questions we get here at Budget Insurance and have written a guide to help you through your journey. 

Let’s get jargon busting! 

When buying car insurance you often hear lots of words and are probably thinking, what does that even mean?! NCD, excesses or third party, fire and theft, are some of the common ones, but what do they actually mean? Well, let us explain. 

What does NCD actually mean? 

NCD stands for ‘No Claims Discount’ sometimes known as No Claims Bonus and quite simply is the number of years you haven’t made a claim on your insurance policy. For most insurance providers the higher NCD you have, the more likely you are to receive a reduction on the price of your premium. If you have a Budget Car Insurance policy, you can upload your NCD proof, which is a letter from your previous insurance provider, via our My Account. 

What different types of car insurance cover are there? 

Comprehensive cover 

This cover offers you the widest insurance cover, but what does this actually mean in English? Well, you are covered if your car is stolen, damaged by fire or accidentally damaged. A Budget Car Insurance policy also covers you and your partner if you are permanently injured in an accident involving the car. 

Third Party Only 

This is the minimum cover you are required to have by law to drive your car on UK roads. Whilst this is often seen as being the cheapest option, it offers the very minimum cover. Essentially this cover means that if you are in an accident with another car, your insurance company will only pay for the other car to be fixed. 

Third Party Fire and Theft 

The only difference with this cover is that in addition to providing the minimum third-party cover, you are also covered for fire and theft of the insured car. 

How many additional named drivers can I have on my policy? 

While every insurance provider is different the maximum number of drivers allowed on a policy is usually the policyholder plus four named drivers. Only drivers named on your certificate of insurance are insured to drive your car. Similarly, you can only drive someone else’s car if you are a named driver on their certificate of insurance. 

You will usually incur an extra charge for adding named drivers, however sometimes adding an experienced driver as a named driver to your policy if they are regularly drive your car can sometimes reduce the cost of your insurance.  

It is possible that if you have a comprehensive policy you may have third party only cover when driving a car that you do not own. However not all policies will provide this cover, so it is best to check with your insurance provider. 

What do I do if I change my car within the year? 

Feeling a bit flash or just come across a bargain and changed your car within the year? It does happen! Yes, unfortunately if you change your car within the year’s insurance, then you will need to call your insurance provider immediately to advise them of the change. There will almost certainly be a change of premium but it’s straight forward and can be sorted within minutes over the phone. It’s worth noting that you can call your insurance provider for a quote to find out how much this will cost before you purchase the car. 

It’s important to let your insurance provider know of any changes in your personal circumstance, from living situation, address, to change of job. All these things can effect your policy and must be up to date for you to claim if something happens. 


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We’re currently experiencing a high volume of calls into our contact centre and whilst we are doing our very best to maintain service levels, we ask that you only call our contact centre if absolutely necessary so we can keep our phone lines available  for vulnerable customers and those who don’t have access to online services.

If you need to check any details or make a change to your policy, please  log in to your Self-Service Centre. It will be much quicker for you to make changes to your policy online at the moment. Once logged in, you can also use our Webchat service which is available Monday- Saturday 8am-6pm and Sunday 10am-4pm to make changes, accept or decline your renewal or if you need to let us know about a claim. To log in, please click here.

We also have some other information that may be useful. Click here to read our FAQ’s, and information on what we are doing to support key workers can be found here.