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Car insurance: All you need to know

Did you know the average Australian driver is involved in a motor vehicle crash nearly every seven years?

Buying a car is a big deal and, after spending your hard earned money on your dream machine, you need to make sure you are protected in the event of an accident.

Nobody thinks it will happen to them, but if you do have an accident it’s comforting to know that you won’t have to pay possibly thousands of dollars for repairs.

Car insurance provides peace of mind and vital cover that you need. Make sure you pick a policy that fits your individual needs, rather than the first policy you come across.

Types of car insurance

So let’s break it down. In Australia, there are four main types of motor vehicle insurance:

Car insurance is there to cover the cost of repairs to your car, in the event of an accident. But remember that not all types of insurance will cover you for damage to other people’s vehicles.

So what type of insurance covers who and what…

Type Your cars damage Damage to other peoples car Damage or theft of your car Injuries or death to others
Comprehensive YES YES YES NO
Third party fire and theft NO YES YES NO
Third party property NO YES NO NO
Compulsory third party (CTP) NO NO NO YES

Let’s go into a little bit more detail…

Comprehensive car insurance

Wouldn’t you know in the next 24 hours, around 4,800 Australians will be involved in road crashes!

Comprehensive car insurance is the “daddy” of car insurance, as it’s the most common level of cover purchased in Australia. It is generally the most expensive of all the types of insurance but that is largely because it has the most comprehensive level of cover.

Comprehensive car insurance covers repair or replacement of your vehicle from events including theft, collision, malicious damage, weather related damage and broken windscreens. Depending on your policy, it can also cover the cost of emergency repairs and transportation costs.

CTP insurance, (compulsory third party insurance) or also known as CTP Greenslip (NSW)

CTP insurance is mandatory throughout Australia. Your vehicle cannot be registered or legally driven on the roads without it - and you’ll need it to register your car every year.

CTP covers personal injuries to others if you are involved in an accident. However it does not cover the property damage. Ask yourself if you could afford to replace a car in the event of an accident? Get higher coverage to protect against theft and damage.

In a nutshell…

CTP covers personal injuries in an accident, including:

  • if it’s your fault
  • if it’s the fault of someone else driving your vehicle
  • if someone in your vehicle is injured

It does not cover:

  • any damage to property or vehicle/s
  • any damage to you

Third party, fire & theft

Third party, fire & theft insurance provides cover if your car is stolen or damaged as a result of fire, and it covers you for damages caused by your car to other people’s property. Third party, fire & theft will not cover your car in the event of an accident. This type of policy is readily available in most states, but has limited availability in NSW and ACT.

Third party property

Third party property is the cheapest non-compulsory car insurance option. This policy will cover damages caused by your car to other people’s property, but will not cover for your vehicle.

Your car insurance premium

Because not all drivers share the same risk profile, there are some variables that will influence the premium you pay on your car insurance, such as your:

  • Age
  • Gender
  • Location
  • Driving record
  • Car type
  • Most common parking location

Significant savings can be made by shopping around and comparing premiums for the same type of cover.

Other ways to reduce your premium include:

  • Adding security devices to your car
  • Driving safely to improve chance of a good driving record
  • Bundling your insurance with one provider to get discounts
  • Not making unnecessary modifications to your car
  • Using telematics

If you haven’t yet bought your car, it may pay to do some research in advance, so you can get an idea of how much your choice of car will influence your insurance cost.

Use our comparison to rate and review a variety of reputable car insurance providers. Compare price, features and types of cover.

Why compare car insurance?

It's a tricky task visiting several car insurers websites and trying to understand what you are comparing is like-for-like. Using a comparison website like ours can help you save time (and money) by comparing quotes from several reputable brands in one place.

The prices you see on our site are exactly the same as if you went straight to the insurers site. You'll be able to compare different policies and levels of cover that are right for you.

Whether you’re a car fanatic; you’re insuring your car for the first time; or you’re due to renew your existing policy, it‘s important to get the right policy for your pride and joy, and be confident that your loved ones are in safe hands.

Remember it is important to compare apples with apples, so make sure you are comparing different companies with the same levels of coverage.

Everyone loves the sound of cheap car insurance! Brrrm!

Which car insurance company?

Pulling your hair trying to decide which car insurer to go with? The market is flooded with hundreds of companies all offering the “best deal” and it can be very confusing figuring out which type of car insurance you need.

Buying car insurance online generally offers lower prices. Here are some handy tips to help make your decision that little bit easier:

    • Read car insurance reviews of past customers on comparison websites to make an informed decision on the right policy for you.
    • Chose a car insurer with clearly worded policy documents that are simple to download and understand.
    • Chose an insurer with good customer service who are easy to contact with fast, friendly and informative claims and customer service teams.
    • Tailor policies to your needs and reduce the premium you pay by nominating drivers, decide if agreed or market value will be best and look for excess that can be adjusted.
    • Choose the right cover for you to pick your policy, don’t pick on price alone.
    • Choose your own repairer for as long as you own the car to keep costs down.
    • Choose how you pay, it might work better for you as a one off lump sum or monthly instalments.
    • Roadside Assistance is offered with some companies, just make sure that it is cheaper going with the insurer than the roadside assistance company themselves.
    • Exclusions in your car insurance policy are listed in the Product Disclosure Statement, so be sure to read it carefully. And if you ever have any questions, don’t be afraid to ask your insurer.
    • Check for discounts with the different insurance providers for example if you have no claims bonus.
    • Ask friends and family to see which companies they are using.
    • Look for a cooling off period where you can return the policy and get your money back, providing no claim has been made.

On Yours Marks, Get Smart, compare car insurance quotes now.