The Australian Car Insurance Comparison Guide
There’s a wide range of car insurance options in Australia, which is impressive for a country of its size. It’s easy to become overwhelmed given the number of companies offering “the best”, “the cheapest” or “the best and cheapest” car insurance, and we have identified 7 things that you should consider before you commit to one particular insurer.
What kind of insurance are you looking for?
Compulsory third party insurance: Known as Greenslip Insurance, this is the most basic form of car insurance for an Australian driver and is compulsory for Australian-registered cars. While it doesn’t cover damage to the policyholder’s car or cars and property of others, it does cover personal injuries for people involved in an accident, usually including some limited cover for the driver at fault.
Third party property insurance: This pays for any damage you cause to another person’s car or property. However, it doesn’t cover the cost of repairs for your own vehicle. Third party, fire and theft insurance is an extension of third party property insurance, and will insure you against the loss of your car through theft or fire.
Comprehensive insurance policy: This combines all of the above. As such, if yours and another person’s car are damaged through your own fault, your insurance policy will extend to cover repairs for both parties.
Can you buy the policy online?
An insurance company that allows you to sign up for car insurance online is convenient for the buyer as it can be done at any hour or any day of the week. You can also take your time to fill in the application form, compared to completing one over the phone. However, telephone application does provide the opportunity to ask questions and strike deals during the application process.
Consider a multi-policy deal
Some insurance companies provide insurance for the home, travel and health in addition to car insurance. In many cases, insurance companies may offer a more favourable premium to customers who purchase more than one type of insurance from them.
What’s your demographic?
Did you know that the cost of car insurance premiums can vary based on where you live? Premiums can differ even further based on your address within the state itself as well. Varied intra-state car insurance premiums are mainly down to the risk an insurance company perceives you and your car to be. Therefore, the higher the risk of your vehicle encountering an accident or being stolen usually means the higher the premiums you have to pay.
Age and gender too, are parameters that need to be considered when comparing car insurance. Young men are perceived to be more of an insurance risk, and this is reflected in their insurance premiums. Additionally, the owner of a newer, more expensive car is likely to pay higher insurance premiums based on the risk such a vehicle poses for the insurance company.
Discounts are for the asking
Sometimes, people compare car insurance when they’re thinking of switching to another insurance company. In this case, a person has nothing to lose by asking their current insurer if they’re able to match or surpass a cheaper quote from another company. Revisiting the terms of your present car insurance policy may also allow negotiation of better terms for you; there may be discounted premiums for drivers above 25 years of age. Tailoring your car insurance policy to match your personal requirements can make it even more affordable.
Look beyond the bottom dollar
A cheap insurance quote is very attractive. However, when comparing quotes from different insurance companies, you need to ensure that the policies themselves are similar too, to prevent comparing apples and oranges. By scrutinizing policies closely, you won’t wind up paying less but receiving inferior or limited insurance coverage from Insurer A, as opposed to paying Insurer B slightly more in return for more benefits and security.
One of the first things a person looks at when comparing car insurance is the premium paid. At first glance, a cheaper premium is certainly tempting. Having extra cash available is always welcome. Yet, is an annual difference of $200 really such a bargain if, in the event of a write off, the insurance company deems your car worth less than you expected?
You need to ensure that the bottom value an insurance company quotes for your car isn’t too far away from your car’s actual worth and to identify the financial burden to you in the event of a write off and if the company undervalues your car.
Point-for-point comparison of different policies
There are sure to be similarities when you compare the basic policies of most major car insurers. A consumer needs to look at the cost of the policy and any extra benefits that particular insurer provides and ask about them if they’re not immediately obvious. For instance, comprehensive car insurance may entitle you to a hire car if your car needs repairs, until a claim is paid, or your car recovered (if it was stolen). Different insurers also have varying conditions pertaining to no-claim bonus and excess payable.
Different insurers offer different hire car periods that may also vary based on the premium you pay. Additionally, the time it takes to process a claim may take longer (months) than the period to which you’re entitled the hire car (days). The maximum value insured for items inside the car that are damaged or stolen may also vary between companies.
In the event car repairs are needed, most insurance companies have workshops authorized to carry out the necessary repairs. Some people, though, may be more comfortable appointing a mechanic of their own or who can finish the job more quickly. Aside from determining if this option is available to you, be sure to determine who bears the cost of transporting the car to the garage and if roadside assistance is provided.
This article contains general advice about car insurance. The author has not taken into account your financial situation or needs and you should consider whether the advice provided is appropriate for your own circumstances before relying on it.
Filed Under: Insurance Comparison
