What does third party property damage car insurance cover?
Third party property car insurance
Third party property car insurance covers you for damage to other people's property – for example someone else's car, home or shop. It covers only this and nothing else, up to a certain limit (commonly $20 million). This type of policy adds an additional layer of protection over the bare minimum compulsory third party insurance, and prevents you from having to be out of pocket for potentially enormous bills if you hit something expensive.
Third party, fire and theft car insurance
This is a step up from third party property insurance. In addition to covering you for costs if you damage someone else's property, it can pay to repair or replace your car if it's damaged by fire or stolen. However, it still doesn't cover you for damage done to your own car – only comprehensive car insurance covers you for this.
Finder survey: What type of car insurance do people have?
Response
Male
Female
CTP & comprehensive
83.96%
81.23%
CTP & third party property only
5.21%
6.13%
I don't own a car/car insurance
5.63%
6.13%
CTP & third party fire & theft
2.5%
3.83%
CTP only
2.71%
2.68%
Source: Finder survey by Pure Profile of 1006 Australians, December 2023
Our picks
If you've opted for third party property damage car insurance over comprehensive cover, you probably just want a cheap insurer that has a good reputation. To help you find one, our insurance team collected 250 third party property damage quotes from 20 popular providers, including those not currently available on Finder.
We've hand-picked 2 based on price, features and complaints data. Both of the picks cover you for accidental damage your car causes to other people's property, including their vehicles.
Why you can trust our research
20third party car insurance policies analysed
250prices gathered
100+hours of research
Great for price: Virgin third party property damage car insurance
Our verdict
Virgin is consistently one of the cheapest third party policies available. Our team got 250 quotes for third-party car insurance from 20 popular providers. Virgin was the joint cheapest on average across all major states.
It cost an average of $37 per month in our research.
It was $13 a month cheaper than the average price.
It covers up to $5,000 worth of damage caused by an uninsured driver.
Budget Direct was only a few cents more.
Like other third-party policies, it does not cover damage to your own car.
This is third party only cover; not third party, fire and theft.
Our team gathered 250 quotes from 20 different third-party car insurance policies across NSW, QLD, VIC, SA and WA. The car model used for all quotes was a 2007 Mazda 3 Neo BK Series 2 Auto 5DR hatchback.
Virgin emerged as the most affordable policy on average. Providers available in only one state, such as RAA, weren't included in the comparison.
It's important to note that while our team conducted extensive research, Virgin may not necessarily be the cheapest policy for every individual. Various factors such as location, driving history, age, and gender can influence the price of a policy.
Great for value: Budget Direct third party property damage car insurance
Our verdict
Budget Direct was the second cheapest third party policy, according to our research. To be exact, it was $1 more a year than Virgin! They're virtually the exact same policy but Budget Direct has more positive online reviews, so is still worth calling out.
It's one of the cheapest third party property damage policies.
You can lower costs further by restricting drivers.
Comparatively good reviews online.
There's a 15% sign-up discount but it only applies for the first year.
Like other third party policies, it doesn't cover damage to your own car.
It may cost you more if there's a younger driver on the policy.
Our team got 250 quotes across 20 different third party car insurance policies. We got quotes in NSW, QLD, VIC, SA and WA. The car model we used for all quotes was a 2007 Mazda 3 Neo BK Series 2 Auto 5DR hatchback.
Budget Direct was the second cheapest policy on average. We selected it as our value pick because it has good online reviews and scored highly in the Finder Customer Satisfaction awards.
Keep in mind, while our team did a lot of research, Budget Direct may not be the best value policy for you. There are lots of things that can impact the price of a policy such as where you live, your driving history, age and gender.
Keep in mind that these costs are based on a limited profile that we've outlined below. As with all car insurance, the cost of a third party policy will vary based on your age, location, gender, and other variables such as where you park your car.
To determine this estimated cost, we sourced quotes in 2023 using this profile:
Male, aged 35
Lives in New South Wales
Drives a 2007 Mazda 3
Car travels up to 15,000kms per year
Excess $700 (differs depending on provider)
Driver has held his license for 5+ years
Car used for private use
Driver has made no claims in the last 3 years
No additional drivers
Excludes drivers under 25
No finance on the car
Car is kept in a garage
Market value
How to find the best third party coverage for you
1. Compare quotes
Most third party car insurance policies are very similar so price is an important factor. If you think you're paying too much, compare car insurance policies to find a better deal.
Pro tip: "To find the best deal, be really clear on the cover you want and compare 4–5 different options", says Finder's head of editorial Sarah Megginson.
2. Choose a higher excess
Your insurer will offer you a lower premium in return.
Pro tip: We researched 20 third party policies. Allianz, Budget Direct and Virgin were the 3 cheapest and come with variable excess options.
Pro tip:Budget Direct has the biggest range of age restriction options of any major insurer: 21+, 25+, 30+, 40+ or 50+.
4. Uninsured motorist damage
Some third party policies cover damage to your own car caused by an uninsured driver. The cap is usually $5,000 but will vary between insurers.
Pro tip: Insurers including Budget Direct, Youi, QBE and Kogan all offer this feature. Bingle and Allianz do not.
5. Discounts
Sign-up discounts can be a good way to pay less. Just make sure the policy is still the right fit for you.
Pro tip: 39% of Aussies auto-renew their car insurance. Insurers often jack prices up significantly after the first year. To save, compare every 12 months.
Is third party car insurance worth it?
Could be good if you:
Have a low-value car. For example, if it's worth under $10,000. Sometimes it is not economically viable to insure for comprehensive, especially for lower value cars, or drivers with a higher excess (usually younger drivers).
It's all you can afford right now. Our research shows third party is more than half the price of a comprehensive policy.
Want more than the bare minimum (CTP) which only covers injuries to people. "I like knowing I'm covered for the costs of their repairs" says finance specialist Nicole Pedersen-McKinnon, "Even if I collide with a Maserati".
Might not be good if you:
Own an expensive car. You could be thousands out of pocket if it was damaged.
Rely on your car. Could you afford to replace it if was written off?
I had a third party property damage policy on my old car. It was a pretty run-down vehicle, plus I was always working from home and barely used it or left it unattended, so a comprehensive policy just wouldn't have been worth the money. A basic third party policy to protect me from the costs associated with damage to other people's property was all I needed at the time and cutting it right back was a good way to save money.
According to our research of nine providers, AAMI offers one of the cheapest policies. Other cost-effective insurers include Bingle & GIO. Keep in mind prices vary for everyone.
The best third party car insurance policy depends on your needs. AAMI, Bingle & GIO offer some of the cheapest policies according to our research. However, you should also look at what's covered. For example, some policies may cover you for ridesharing as well as damage to other people's property.
Usually not. Most third party car insurance policies do not cover windscreen damage. This is usually clearly mentioned as an exclusion.
When calculating your third party property damage insurance premiums, insurers consider questions like:
How old are the people driving your car?Younger drivers are more inexperienced and also feature heavily in Australian road crash statistics, which means they cost more to insure.
Are you a good driver? Drivers with a long, blemish-free driving record will obviously cost less to insure than those who have made claims in the past or who have multiple traffic infringements.
Where do you keep your car at night? Areas with high theft and accident risks will generally result in higher insurance premiums for car owners.
What type of car do you drive? Inexpensive, low powered cars are typically cheaper to cover than high powered, expensive vehicles. Any modifications and accessories fitted to your vehicle will also be taken into account.
How much do you use your car? If your vehicle is used for business purposes, or more frequently than most, you may have to pay a higher premium. Alternatively, if you don't drive too often you can opt for a Pay As You Drive policy.
No. Third party insurance is for your vehicle. Your car is insured to be driven by certain people as described in the insurance policy. You are not automatically covered by your usual third party insurance when driving other vehicles.
If you hold third party property damage car insurance, then any car or property you damage in an accident is covered, your own vehicle is not.
No but it's easy to get them confused. Compulsory third party is mandatory in Australia. It protects you from legal and medical costs if you injure or kill someone in a car accident.
Third party property damage, on the other hand, covers other people's property if you damage it with your car and are at fault.
The excess is the amount you're required to contribute towards the cost of your claim. As an example, if your excess is $250 and your claim is for $2,000, you will pay the first $250 of your claim and your insurer will cover the remaining $1,750. Insurers will charge a basic excess, which is the minimum you'll need to contribute when you make a claim, as well as a voluntary excess (in return for a lower premium) and an age excess (if your policy features a young or inexperienced driver). Depending on your insurance provider and your individual circumstances, other excesses may also apply to your cover.
An uninsured motorist extension (UME) is an optional extra available with some third party car insurance policies. It covers damage to your vehicle up to set limits (typically around $3,000–$5,000) in the event that it's damaged by an uninsured driver, that you were not at fault and that you can provide the uninsured driver's name and address.
This will depend on the provider. In many cases, roadside assistance is only an optional extra for comprehensive policies. However, it's worth noting that even if you can't add it as an option to your policy, you can just purchase a stand alone roadside assistance policy.
Car insurance: Key terms to know
Here's a summary of common definitions you'll see with car insurance. Plus what they actually mean to help you while you're comparing.
Policy term
Definition
Good to know
Cover for drivers under 25 years old
Whether you want insurance for an additional driver under the age of 25.
Be sure to shop around for cheaper deals available each year as you get older and gain more driving experience.
Flexible excess options
This policy feature lets you adjust the excess on your car insurance policy. An excess is the amount you need to pay upfront to make a claim.
Policies tend to split their excesses as follows: a basic excess and an under-25 driver excess.
Legal liability
Cover in case you get sued as a result of injury or damage you cause to people or their property.
Most insurers pay up to $20 million in legal liability cover.
Multi-policy discount
A discount an insurer offers you if you hold at least one other policy with them.
Savings usually range from 5–25%. But it isn't always the case you'll get cheaper cover if you hold multiple policies with the same insurer.
No claim discount
A discount you get on your car insurance premium for each year that you don't make a claim. It's also known as a no claim bonus.
Your discount can be as high as 15% if you have no at-fault claims for 5 years.
Pay monthly at no extra cost
You can make payments each month, rather than annually, at no extra cost.
Only a few insurers in Australia won't charge you more by paying monthly. So, you can often save by paying your whole premium in one go (if you can afford it).
Third party car insurance
Entry-level insurance that covers damage you cause to someone else's vehicle or property.
This policy, often referred to as third party property damage (TPPD), won't cover your car; but it could stop you from facing large bills from other people.
Third party, fire & theft
Mid-range cover that'll protect you financially for damage to another person's vehicle or property as well as damage to your car resulting from fire or theft.
Third party, fire & theft doesn't cover damage to your car in the event of an accident; for that, you'll need comprehensive car insurance.
Windscreen cover
With windscreen cover in place, your excess gets waived so you're not out of pocket if your car window gets damaged.
You can add excess-free windscreen cover to a comprehensive car insurance policy. This could save you hundreds of dollars if you need to replace your windscreen, which can otherwise cost as much as $1,000.
Roadside assistance
A type of insurance that protects you if you get stranded because of an issue with your car. It's also known as breakdown cover.
You can add roadside assistance to some car insurance policies; there are very few insurers who'll include it automatically. A roadside assistance callout won't count as a claim.
Underwriter
The company that assesses the risk of providing you with insurance.
Examples of underwriters in Australia include Youi Pty Ltd, Insurance Australia Limited, AAI Limited and The Hollard Insurance Company Pty Ltd.
Gary Ross Hunter is an editor at Finder, specialising in insurance. He’s been writing about life, travel, home, car, pet and health insurance for over 6 years and regularly appears as an insurance expert in publications including The Sydney Morning Herald, The Guardian and news.com.au. Gary holds a Kaplan Tier 2 General Advice General Insurance certification which meets the requirements of ASIC Regulatory Guide 146 (RG146).
Hi Bjorn,
What’s best or cheapest will depend on your personal circumstances and driver profile so I couldn’t recommend specific providers to you. Instead, I can share a few tips to help you find a cheaper policy:
– Get quotes from at least 3-5 providers so you can see the difference in pricing on offer
– Look for sign up discounts
– Consider adjusting your excess; a higher excess means a lower premium. Just be sure you can still afford the excess in the event you’re required to pay it
– Restrict drivers under 25 if you’re sure no one under that age will drive the car. This can help bring the cost down as insurers typically view younger drivers as more risky and can up the premium if they’re not excluded
Remember, every policy varies so to ensure it covers what you need, read the product disclosure statement on the provider’s website.
I hope this helps!
I have a 2004 Holden Berlina which has not been registerred nor driven for 5 years , it is now for sale, can I get CTP insurance for less than 12 months , even 6 month to match the proposed registration term.
James
Hi James, CTP insurance can typically be bought for either 6 or 12 months but it’s best to check with your insurer as payment terms may vary. This page may be helpful for any other questions: https://www.finder.com.au/car-insurance/ctp-insurance
Hello, I have an at fault claim from nearly 4 years ago, a driving under the influence of drugs charge for which I lost my licence for 6 months approx 3 years ago plus I have a criminal record for drug charges… Can you help me weed through the options, if any, available to me to take out a policy?
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I have a car with hail damage only.
Can I still get third-party insurance?
Hi Tina,
Provided the car is still safe to drive, it should be possible to get third party car insurance. Good luck!
I am 76, male, car worth less than $10,000, drive less than 5,000 km annually. What’s best, cheapest insurance for me, for damage to other cars only?
Hi Bjorn,
What’s best or cheapest will depend on your personal circumstances and driver profile so I couldn’t recommend specific providers to you. Instead, I can share a few tips to help you find a cheaper policy:
– Get quotes from at least 3-5 providers so you can see the difference in pricing on offer
– Look for sign up discounts
– Consider adjusting your excess; a higher excess means a lower premium. Just be sure you can still afford the excess in the event you’re required to pay it
– Restrict drivers under 25 if you’re sure no one under that age will drive the car. This can help bring the cost down as insurers typically view younger drivers as more risky and can up the premium if they’re not excluded
Remember, every policy varies so to ensure it covers what you need, read the product disclosure statement on the provider’s website.
I hope this helps!
I have a 2004 Holden Berlina which has not been registerred nor driven for 5 years , it is now for sale, can I get CTP insurance for less than 12 months , even 6 month to match the proposed registration term.
James
Hi James, CTP insurance can typically be bought for either 6 or 12 months but it’s best to check with your insurer as payment terms may vary. This page may be helpful for any other questions: https://www.finder.com.au/car-insurance/ctp-insurance
Hello, I have an at fault claim from nearly 4 years ago, a driving under the influence of drugs charge for which I lost my licence for 6 months approx 3 years ago plus I have a criminal record for drug charges… Can you help me weed through the options, if any, available to me to take out a policy?
Hi Ryan,
Check out this article for more info that might be useful for your situation:
https://www.finder.com.au/car-insurance-criminal-record
I’m interested in looking at car insurance which allows for some rideshare work. Can you provide a list?
Hi Dan,
Thanks for the message. You can head to our guide to rideshare insurance here. More than a dozen providers offer some coverage for rideshare drivers.
Best,
James