Car insurance can sometimes be a pain to sort out, but it's a very important part of owning a car. Providing monetary protection for the driver and anyone else involved in an accident, it certainly pays to be insured. On the whole, car insurance in the UK doesn't differ too much from car insurance in the US.
Is it essential?
In the UK, it's absolutely mandatory to have car insurance on your car. That is, unless the car is owned by the government. Likewise, in the US, going without car insurance in not an option. Minimal cover provided in the US is third party liability, which will cover damage to another person's vehicle and any liability claims from other parties.
The penalties for not having car insurance as a driver in the UK can be pretty tough; in fact, they can range between a fine and a prison sentence. This is determined by the courts without any intervention by the government. There's also the risk of receiving penalty points on your licence - or having your licence suspended altogether.
In the US, no insurance can lead to suspension of your driver's licence, your registration and receiving a ticket and a hefty fine.
In the British Isles, drivers are covered by the National Health Service - a free health, GP and hospital service provided and funded through tax. As a result, drivers here do not need to take into account liability for hospitalisation and medical treatment after an accident. This applies anywhere within the boundaries of the United Kingdom.
The Road Traffic Act
In the UK, the government sets the actual legal requirements for car insurance through the Road Traffic Act. This act has been subject to change after it was initially implemented in 1931. The first Road Traffic Act stipulated that at the least third party insurance was required to drive a car.
Most recently, an update to the Road Traffic Act ruled that car insurers would no longer be able to calculate car insurance according to gender. As of December 2012, female drivers have been paying the same as male drivers on the basic rate.
Closer to the UK, Ireland has some slightly different rules. After the change in rules regarding gender equality, it's a much better idea to go for an Irish insurer if you live there. One Irish insurer, 123.ie, conducted a survey and found that 87% of males in Ireland could save on their car insurance by switching to them.
Guest post - 24 Mar 2013