You are required by law to have adequate insurance for any motor vehicle that is used on the road. If you do not have insurance you could face a fine and have points put on your license. You also need insurance in order to obtain vehicle tax.
Motor vehicles that require insurance include cars, vans, lorries, motor cycles and caravans.
The most basic insurance you are required to have by law is third party. This is usually the cheapest car insurance option and will only cover damage sustained to the other driver's car. It will not cover your own vehicle. Generally speaking most people will opt for third party cover when their car has a very low value
The next level of insurance is third party cover plus fire and theft. This is as above for third party with the additional protection against fire and it being stolen.
Fully comprehensive insurance will cover not only damage to the other person's vehicle in the event of an accident but it will also cover damage sustained to your own car. This is usually the most expensive type of car insurance cover but gives you complete peace of mind.
To obtain cheap insurance make sure you shop around as the price you pay can vary greatly between companies and depend on your personal circumstances. For example young adult males tend to pay the highest for insurance as statistically they are most likely to have an accident involving a large claim. The crime rate where you live is also taken into account, as well as whether your car will be parked off or on the road.
Some policies will include breakdown cover, which is always useful. Take advantage of no claims bonus offers as it will reduce your annual premium.
Always check the details and small print of your policy carefully so you know exactly what is and isn't covered.
Bicycles are not required by law to be insured but it is a good idea to get protection in case of theft or damage.
For further information visit Do I need motor insurance?, What does third party cover? and Where can I buy cheap car insurance?