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A User’s Guide to Car Insurance Jargon

There are many confusing and rarely used words in any financial product, and even those words that are commonly used may have very specific definitions that cause them to have a different meaning from the common use. Getting a cheap car insurance quote is no different in this regard. Given the number of UK drivers, that means there are likely many confused drivers on the road today. This vocabulary issue is even more pressing when you consider the great many pounds that people spend on car insurance every year. Understanding what the words in your insurance policy and insurance application process actually mean can help motorists save money while staying road-legal.

A User’s Guide to Car Insurance Jargon

Annual Mileage

Annual mileage is the total distance that your car will drive in a year. This is an important consideration for insurance companies because the more your car is on the road, the greater the risk the insurance company faces of having to pay out a claim. For business car insurance this is also called annual business mileage.

Black Box

A black box is a slang term used to describe a device that some insurance policies use to help determine pricing. The device fits into a data port in your car to record different driving metrics. The insurance company uses this information to determine how safe of a driver you are. Accelerating rapidly, breaking quickly, speeding, and other maneuvers can raise the cost of your insurance because you are seen as a greater risk for the insurance company.

Breakdown Cover

Breakdown cover provides protection for repairs if a driver’s car suffers from a mechanical breakdown. More often than not this is an extra, but some policies will include it standard.

Comprehensive Insurance

Comprehensive insurance providers cover for damages to your car in accidents when you are at fault. This is in contrast to third-party and third-party fire and theft which only pays for damages to others property in accidents where you are at fault.

Cover Note

A cover note is documentation to prove you have insurance before your certificate of insurance arrives. It acts as a certificate of insurance, but is not intended to be permanent and is only valid for a period until you get your full certificate of insurance.

Drive Other Cars Benefit

One popular element for many insurance policies is a drive other cars benefit. This allows you to have cover when you drive cars you don’t own. Not all policies include this, and use include it as an optional extra that you have to pay for. Therefore it is important to check with your insurance company before assuming that you have DOC.


An excess is best understood as the money you pay to process a claim. For example, if your excess is £100 and you file a claim for £1000, the insurance company will pay back £900 if the claim is validated.

There are two types of excesses, compulsory and voluntary. Compulsory excesses are those mandated by the insurance company, and voluntary excesses are those drivers take on in order to get a lower rate on their insurance premium.


An immobilizer is a piece of tech that allows owners to remotely disable their vehicle. Therefore, the car cannot be driven away even though it can still be broken into. An immobilizer can help lower your insurance rate because it decreases the risk of theft.

Material Fact

Insurance companies will ask many different questions pertaining to cover. A material fact is any information relevant to that determination.

No-Claims Bonus

No-Claims Bonus is an extra discount you get for every year you don’t file a claim with your insurance.


Points are records of motoring related convictions. The number of points you get for a conviction depends on the particular offense you are convicted of.

Quote Expiry

When you are shopping for insurance you are given a quote, not a price. A quote is subject to change, and a quote expiry is the length of time the quote is valid for.

Third-Party Fire and Theft

This is a type of insurance covers damage to other people’s property, and damage to your car for fire and theft.

Third-Party Only

Third-party only doesn’t cover any damage to your car in accidents where you are at fault, but does cover injuries to other passengers in your car, passengers in the other car, and other people’s properties.