The UK is Europe’s largest insurance market and fourth-largest in the world. In this article we will be discussing on the types of Insurance in UK.
In the UK, insurance works the same way in all of the different regions. Customers pay monthly or annual premiums and an excess fee when they file a claim.
The insurance industry in the UK is regulated by two organizations:
- The Prudential Regulatory Authority (PRA), a Bank of England branch that checks that insurance companies are financially stable.
- The Financial Conduct Authority (FCA), which oversees insurance companies’ conduct.
With over 250 members, the Association of British Insurers (ABI) is the leading representative body for the insurance industry in the UK.
There were 436 insurance agency in the UK altogether in 2017. Compared to 673 in 2004, this was lower.
When you move to a new country, it can be hard to find the best insurance premiums for your needs. Comparison websites can assist in this regard. These websites can assist you in locating the appropriate coverage for you, regardless of whether you are looking for life insurance, car insurance, or any other kind of protection. There are a number of simple platforms in the UK that compare the largest insurers. These are some:
- Go Compare
- Uswitch
- Compare the Market
If you want more information about various insurance policies and providers, the above platforms gives reviews and information about a variety of insurance policies and premiums in the UK.
Types of Insurance in UK
Car Insurance
Car insurance is required to drive in the United Kingdom. Unless they have been declared off the road and are not being used, all vehicles used on the road or kept in public places must be insured. With literally hundreds of companies offering coverage, auto insurance is also a big business. The following are some of the biggest car insurance companies in the UK:
- Aviva
- AXA
You should always shop around when purchasing or renewing your insurance because there are so many options available. Using a comparison site like MoneySuperMarket or Confused.com, you can accomplish this.
In the United Kingdom, there are three types of car insurance coverage:
- Third party: the bare minimum of legal protection. If you cause an accident, this kind of policy will not cover your expenses, but it will compensate any other parties involved.
- Theft, fire, and third parties: This kind of coverage covers you if your vehicle is taken or harmed by fire.
- Comprehensive: This kind of coverage varies from company to company, but it always includes protection in the event that you damage your car in an accident. In addition, some businesses provide 24-hour roadside assistance which may include towing, as well as courtesy cars.
You should apply for a SORN (Statutory Off Road Notification) if you own a car but do not drive it. If not, you could have to deal with damages, wheel-cinching, or even arraignment through the courts.
Costs will depend on the type of insurance, driver profile, and value of the vehicle. In the UK, the average annual premium for car insurance was £431 in 2018.
Excess fees are included in automobile insurance policies. When you file a claim, for instance, you will be required to pay the £100 excess. Additionally, no-claims discounts are common in the UK culture. People who have not used their insurance in a while can get a big discount because of this.
Homeowners insurance
Homeowners are not required by law to purchase building insurance. In the UK, however, it is frequently a requirement of mortgage offers. When you buy a house in the UK, you will need it because of this. In order to avoid breaking the law, landlords must have building insurance.
Your home’s structure and any permanent fixtures and fittings are covered by building insurance. The cost of rebuilding or repairing your home is covered by your policy but general wear and tear is not.
The landlord may occasionally insure the building and include it in your service charge if you own a flat.
Building insurance is not prohibitively expensive. The average annual cost in the UK was £163. However, just like with other insurance products, you will frequently be required to pay an excess. A comparison website like Confused.com is a good place to start if you are not sure which provider to go with.
Social insurance
The United Kingdom has a social security system that is paid for by the National Insurance (NI) contributions that are made by every worker who earns more than a certain amount, whether they are employed or self-employed.
For employees, the current rate for NI payments is 12% of weekly earnings greater than £166. An additional 2% is added to salaries above £962 for those who earn more than this. Workers who are self-employed pay different rates.
In the UK, NI payments are used for:
- Old-age UK pension;
- Maternity benefit;
- Payment for bereavement support;
- Benefit for unemployment.
Health insurance
The National Health Service (NHS) in the UK provides medical treatment to all residents, covering everything from doctor’s visits to emergency surgery. The service is not tied to insurance contributions and is based on taxes.
However, waiting lists are frequently lengthy and resources can be limited. As a result, a lot of people sign up for private health insurance plans which provide faster access to specialists, better facilities, and shorter wait times.
There are many different kinds of private healthcare plans, and how much they cost will largely depend on your circumstances.
Private health insurance is sometimes part of the benefits package at some workplaces. In the UK, a lot of big companies offer health insurance plans, including international firms that are friendly to expats like:
- Allianz Care
- Cigna Global
Dental Insurance
This provides free dental care to people under the age of 18 (or under 19 if in full-time education), pregnant women, and those who have given birth within the past year.
Dental care is available on the NHS, but you will have to pay for it, unlike most healthcare options. Band One (basic examinations and some emergency treatment) to Band Three (crowns, dentures, lab work, etc.) of NHS dental care in the UK are all covered by flat fees.
Some people opt for a private dental plan instead of the NHS service. Although dental plans are not usually covered by private health insurance, you can get one from your dentist or an insurance company. The main reason to get dental insurance is to keep yourself from having to pay a lot of money for big work.
READ: When Is It Ok Not To Have Health Insurance
Insurance for your belongings
Contents insurance is not required by law in the UK, but you should think about getting it to protect your belongings in case of an emergency.
Fire, theft, and flooding are all covered for your belongings, but you usually have to pay extra if you want accidental damage coverage or personal possessions coverage which covers things you take outside of your home.
The cost of your policy will primarily be determined by the value of the items you are insuring, and you can compare providers of contents insurance online. Lemonade is one of the companies that provides this coverage.
 Life Insurance
Although life insurance is not required in the UK as it is in many other nations, many people buy it to protect their loved ones in the event of their death.
In most cases, life insurance policies pay out a lump sum after a death or serious injury. The option of making payments over time in regular installments is available with some policies. Shepherds Friendly’s over-50s insurance is one example of a company that focuses on a specific type of life insurance. Sites like Confused.com are another place where you can compare various providers.
In the United Kingdom, you can buy life insurance from private companies and pay a regular premium based on the amount of coverage you need. Life insurance is also frequently offered as part of a benefit package by employers.
How does the economy benefit from insurance?
The insurance industry in the UK is Europe’s largest. It reduces uncertainty for businesses and gives individuals peace of mind. There are additional ways that insurance contributes to our economy namely to:
- Manage approximately £2 trillion in investments. They invest in businesses, stocks, and bonds with the premiums paid by customers.
- Pay the UK Government nearly £12 billion in taxes annually. This money can be used to help cover costs associated with public services like education.
Is travel insurance required in UK?
If you intend to travel to Britain, you are covered by AXA’s Europe Travel insurance even though the UK is not a member of the Schengen Area.
There is a lot to see in the UK, from the bright lights of bustling London to Scotland’s stunning landscapes. You can go back in time and see Stonehenge, medieval castles, or Sherwood Forest, where Britain’s legendary outlaw Robin Hood lived, or you can go to Liverpool, where The Beatles were born, and watch the two famous football teams in Manchester. Nothing beats eating traditional British fish and chips by the seaside, especially if the weather cooperates.
Fans of sports can also visit some of the best golf courses in the world or catch a game at London’s cricket stadiums, Lord’s and The Oval.
READ: 5 Types of insurance in US
In case you had not noticed, Brexit has altered the status of the United Kingdom within Europe in recent years. This is because the end of free movement between the UK and the EU has affected Britons’ ability to live and work in the EU and vice versa.
On the other hand, if you are going as a tourist, not much might change. The UK still has visa-free travel arrangements similar to those in the Schengen Area. However, it is worthwhile to see if your country has these arrangements as well. A visitor’s visa allows for a maximum stay of six months.
Travelers to the UK can take advantage of AXA’s Europe Travel insurance which covers medical expenses up to €100,000 in the UK and other Schengen Area nations. You can also get the travel insurance certificate that goes along with your visa application.
