Got a car? Then you’ve got a responsibility to yourself & other people on the road.
Car insurance is a safety net for your money if something goes wrong while driving. Giving you financial protection and peace of mind.
Australian law offers various coverage options and regulations. From the must-have policies to optional add-ons. That makes safety and financial aid accessible for all drivers.
Let’s have an overview of significant car insurances in Australia. By the time you finish reading. You’ll know how to choose the right coverage for your needs.
How Does Car Insurance Work in Australia?
For all drivers, it’s the law to have Compulsory Third Party (CTP) car insurance in Australia. This insurance makes sure that if there’s an accident. The people who get hurt are taken care of.
Other than that, there are many choices for car insurance in Australia. Details of which are given below.
Types of Car Insurance in Australia
1. Compulsory Third-party (CTP) Insurance
It’s a must-have for every car, also called ‘green slip insurance’. It is included in your car registration cost (except in New South Wales where you have to buy it separately). You can’t legally drive in Australia without it.
CTP helps pay for injuries to people hurt in an accident involving your car. But it doesn’t cover injuries to you or your passengers, or any other property damage. It’s the cheapest insurance. But if there’s an accident, you will have to pay a lot for damages.
2. Third-party Property Insurance
If you have a car crash, this insurance pays for repairing other cars and things including fences and buildings. But it doesn’t pay for fixing your car.
Sometimes, though, the insurance company helps a little bit. If your car was hit by another car that didn’t have insurance.
3. Third-party Fire and Theft Insurance (TPFT)
With few extra options. It is a mid-level insurance that not only covers property damage. But also protects your car if it’s stolen or damaged by fire.
Moreover, coverage for damage you cause to other people’s vehicles is also included in it. If you are at fault in an accident.
4. Comprehensive Insurance
It’s a much higher level of coverage with the full package. It pays for repairs to your car and other cars involved in every accident.
It is considered the best car insurance in Australia. With complete coverage in case of car theft, damage by fire, flood, or vandalism. Additionally with this insurance, you get a car replacement if your vehicle is written off in a certain time.
But you have to decide the value of your car to claim a replacement. Read to find out how.
How is the Value of Your Car Decided for Insurance?
When you have comprehensive insurance, you can pick how your car’s value is determined. Replacement options will be decided according to this value.
- Agreed value:
A set amount is agreed between you and your insurance company.
- Market value:
This is how much your car would have been worth if you sold it at the time of the incident.
This is important if your car is declared a total loss (written off) or stolen.
What Makes Your Car A Written-Off?
A car insurance write-off happens when your car gets badly damaged in a big crash or accident, and it costs too much to fix it.
The insurance company checks the repair costs and compares them to worth of your car. If fixation cost is equal to or more than value of the car. The insurance company decides to fix it or not.
If it is not worth fixing, the insurance company will declare your car as a write-off. They’ll give you money for your car based on its value before the accident. Additionally, they put this information in a special register called the Written-Off Vehicle Register.
In Australia, each state or territory has its register holding the written-off record.
Types of the Write-offs
There are two types of write-offs according to Australian law.
Type | Description |
Statutory Write-Off | It means your car is too dangerous to drive, no matter how much fixing it gets. Your car will end up in a scrapyard as scrap metal. |
Repairable Write-Off | It means your car could be fixed and used again. But the repair costs are more than what the insurance company is willing to pay. Based on the policy or car’s pre-accident value. |
How will you know the status of your car? Let’s find out.
How to Know If Your Car is Written Off?
To check if your car is declared as damaged beyond repair, you can:
- Contact your insurance company and inquire about the status of your vehicle.
- Search it in the record of PPSR (Personal Property Securities Register). Or check the Written-Off Vehicle Register. Maintained by the relevant authority in your state or territory in Australia.
Having issues with the decision of your insurance company? There is a solution for it too.
How to Dispute the Market Value of a Write-Off Car?
If you disagree with your insurance company’s decision about your car being a write-off. Here is how to change it:
- You can ask your local roads and transport authority if you can fix or re-register your car.
- You can talk to your insurance company and explain why you think fixing the car is a good idea. If you can convince them, they might change their decision.
Important Note:
It’s important to dispute the write-off decision quickly. Your insurance company will submit their decision to relevant authorities within 7 days.
Want to know about more legal boundaries in the process? Read on.
Regulations and Requirements for Car Insurance in Australia
Regulations of car insurance in Perth Australia can vary between Australian states and territories. However, some common regulations include:
Mandatory Compulsory Third Party Insurance (CTP) | All vehicle owners must have CTP to legally run their vehicles on Australian roads. |
No Claim Bonus (NCB) | Insurers offer NCB as a reward for policyholders who drive safely. If no claims are made during a specified period, this can reduce future insurance premiums. |
Claiming Process | If your car is involved in an accident or stolen, you need to notify your insurance company immediately. Follow their instructions and provide all required details to ensure smooth processing. |
These mandatory insurance laws help you in the long run and save you a lot of trouble.
Importance of Car Insurance in Western Australia
We usually face questions like: “Do I need car insurance in Australia?” And the answer is always yes!
Insurance for cars in Australia is essential for coverage and protection against all risks. There are many incidents where your car insurance is needed. Such as:
1. Theft/Car Stealing:
Even with advanced anti-theft devices, cars can still be stolen. Leaving you without your vehicle and facing a hefty cost to replace it.
Insuring a car in Australia will get you back on the road by paying out the value of the stolen car.
2. Traffic Accidents/Car Crashes:
Your car can get damaged in a collision. Or you could be responsible for damaging other people’s property.
Comprehensive car insurance covers your legal liability for any damages caused. It also provides coverage for damage to your vehicle.
3. Damaging Incidents:
A natural disaster like fire, flood or lightning can turn your car into a wreck.
Third-party fire and Theft (TPFT) and comprehensive car insurance offer coverage in such situations. Saving you a big deal of money.
4. Storm/ Bad Weather Damage:
Australian atmosphere is prone to many environmental hazards including storms. You will have to take several steps to protect yourself.
Comprehensive car insurance policies can provide coverage against all financial losses. Including storms, falling trees, cyclones, floods, and hail damage.
5. Mechanical Failure/Breakdowns:
Some car insurance providers also offer optional extras. Like roadside assistance, emergency space, etc. They can even a hire car to help you move after an emergency.
Keep in mind that these extras will add more money to your policy.
If you come across an unfortunate incident on road, no need to worry at all.
Call Kings Car Towing | Get Instant Emergency Services
Our team of experts will transport your broken vehicle safely to anywhere according to its condition.
Additionally, we can connect you with the top car insurers in Australia. Guide you about the insurance policies and handle all the required paperwork.
FAQs:
Who is the best car insurer in Australia?
Top insurers in the car insurance industry of Australia, based on the revenue, include IAG, Suncorp, and Allianz Australia.
What does car insurance cover in Australia?
Comprehensive car insurance provides extensive protection covering property damage in accidents. It also arranges repairs in scenarios like theft, collisions, fires, destruction, weather-related damage, etc.
Is it Possible to Sell a Write-Off Car?
You can sell a repaired write-off after fixing and re-registering it in your name. However, potential buyers can see its history as a “repaired write-off”. This will lower the selling price significantly.
What are the 3 levels of insurance?
1. Auto liability coverage.
2. Collision coverage.
3. Comprehensive coverage.
Is car insurance worth it in Australia?
Comprehensive insurance can lighten the financial burden, offering peace of mind to you. It not only covers property damage in case of accidents but also protects your car if it’s stolen or damaged by fire.
What car insurance is compulsory in Australia?
The ‘Green Slip’ is a type of insurance you are required by law to have in all Australian states to register your vehicle. It is also known as Compulsory Third Party Insurance (CTP).
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