There are lots of different types of car insurance in Australia:. This article will explain the benefits of the most common types of car insurance and why it is important to have the right cover at the right price
CTP or Green Slip Insurance
Compulsory third party the most basic cover and every car in Australia must have it. It provides vital cover against claims for compensation if you severely injure or kill someone in a motor accident.
If your car is not worth much you may think taking out compulsory third party is enough. However, it doesn't cover you for damage caused to other people's property such as if you're unlucky enough to run into a Mercedes Benz. It is the least expensive option, but it really is essential. It covers you for the damage you may cause to another car and may include limited cover for damage caused to your car by an uninsured driver.
Third Party Property Insurance
The next level is Third party property, fire and theft insurance. This also covers you if your car is stolen or burnt out.
Comprehensive Car Insurance
Comprehensive car insurance is the best cover option but also the most expensive. It includes the cost of crash repairs or replacing your car, even if you're at fault.
Money Saving Tips
Shop Around
You can save hundreds of dollars by shopping around for comprehensive car insurance. When looking for a new policy, get at least three quotes. And if you really want to save, gather several more than that. According to a 2004 survey rates for comparable coverage can vary by more than $500 for 12 months' worth of coverage.
When shopping around, there are the independent agents who sell the insurance of various different companies. We recommend that you see several responsible Insurance Brokers like I.C. Frith.
Other than by shopping around, there are ways to save on the premium:
Choose a Higher Excess
A no claim bonus can get you a discount of up to 70%. You need up to six claim-free years to be entitled to the maximum no claim bonus . Find out what the excess level is on the insurance policy you are thinking of buying, there might also be several different excess levels within the same policy too. So, for example, the excess for theft would be a completely different figure to that of damage. The excess on an insurance policy is the portion of the claim a consumer will pay themselves, the rest of the cost then being met by the insurance company. Most car insurance policies do have upper limits for pay outs, so do check to make sure these upper limits would in fact cover you for what you stand to lose.
Car Insurance Tips
Voluntarily raising your excess will in a lot of cases reduce the cost of your insurance, so it's well worth asking the insurer to give a quote for a higher excess and seeing what affect is has on the insurance cost. Another way to reduce your premium is by Nominating drivers or restricting the use of your car to drivers over twenty-five years of age.
Don't forget to ask for any discounts - for example if you have another policy with the same company, you're a long-term customer or if your car has a great theft alarm or an immobilizer. Finally don't be afraid to do what is known as "Dutch Auctions." Get the best price you can off several companies and then try to do one better. You never know what the lowest price is until you make enough inquiries.
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In all states but NSW and Queensland, compulsory third party insurance is provided by only one state-owned or government-licensed insurer. In NSW and Queensland it's offered by a number of insurers and it pays to shop around. For an online price guide go to:
NSW - http://www.maa.nsw.gov.au or phone 1300 137 600
QLD - http://www.maic.qld.gov.au or phone 1300 735 404
