Five pesky policy conditions buried in car insurance contracts

By John Grant

In doing our review of the insurance polices we looked through many dozens of contracts. It is true that no two policies are the same and we found dozens of potentially tricky conditions. See car policy comparisons here.

1. Under 25 year old driver 
   Quite a number of policies have exclusions for any person under 25 driving the vehicle. The exceptions are for those under 25 years olds who have been named and appear in the policy schedule as a named driver or the insured. If you haven't notified your insurer of someone under 25 driving your car you may find you are uninsured.
    
2. Under the influence
   Most policies have a clause that excludes cover if someone who is under the influence of alcohol or drugs is driving the vehicle. In most cases there is an effort to define under-the-influence. However a few of the policies require the insured person to prove that they were below the legal limit at the time of the accident. Without a breath test this could be a difficult exercise.
    
3. Painting undamaged parts of the car
   There was a condition in one of the policies that stated there would be no cover for painting parts of the car undamaged by the accident.
    
4. Off roading
   I wonder if some owners of four-wheel drive vehicles are aware of some policies specifically exclude cover for any use of the vehicle that is not on a road or driveway.
    
5. Liability Insurance
   One company that is a major player in the car insurance market has defined the insured person under liability cover being the person named in the schedule. Literally this could be taken as not providing cover for damage to other property if the vehicle is driven by anybody other than the person named in the policy schedule. Fortunately most insurers take a realistic look at this and common sense prevails. However there are grounds for concern regarding the consistency of how these conditions are applied.

The major lesson from this is to make sure you read your policy and understand about those potential areas that could cause problems and either approach your insurer for a written explanation of the way they will interpret it or find an alternative insurer who doesn't have this condition in their policy.

See car premium comparisons here.