How does car insurance in Australia cover additional drivers?

How does car insurance in Australia cover additional drivers?

You might be covered if an unlisted driver gets into an accident in your car, but there are some conditions to be aware of. 

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There are car insurance policies out there that will provide cover for a friend or family member, even if they're not nominated on your policy. Some insurers offer you cover for an unlisted driver but they usually come with an unlisted driver excess. Others will simply refuse to cover unlisted drivers, so it pays to know when this might apply to you.

Does car insurance cover additional drivers?

Yes but coverage varies between car insurers. You might find that one insurer will cover anyone who drives your car even if you haven't nominated them on your policy, while others will likely charge an extra excess in addition to other excesses. This is also usually the case if the additional driver is under 25, or over 25 but has less than 2 years driving experience.

In the majority of cases, you will need to list all drivers on your policy who regularly use the car. If you don't, you risk a reduction or refusal of a claim. So you can't put a car insurance policy in your name if someone else is the main driver. This is called car insurance fronting and it's illegal.

How do insurers treat additional drivers?

Depending on who you are with, you may have to pay an additional excess for other drivers in the event of a claim. These insurers, for example, provide the following cover:

  • Bingle: Unless you list them on your policy, you will have to pay an additional excess on top of your standard excess for claims made for loss, damage, or liability by household members or regular drivers using your car. An unlisted household member or unlisted regular driver excess will be in the region of $1,950.
  • Huddle: There is an undeclared driver excess if the driver is under 25 and hasn't been declared as a driver. This also applies to inexperienced drivers e.g. anyone who has not held a driver's licence that is valid in Australia for more than 2 consecutive years. It comes with an excess of $800. Excesses for drivers aged 21 to 24 are $1,600 and $2,000 for drivers under 21.
  • Budget Direct: Additional drivers under the age of 21 will have to pay a $600 excess and drivers aged 21 to 24 will need to pay $500 in the event of a claim. Drivers who haven't held a full Australian licence for at least 2 years will have to pay $500, while unlisted will pay $600.
  • Youi: Youi have a driver specific excess for unlisted drivers and young drivers, regardless of whether they are a regular or listed driver.
  • Virgin: Additional excesses apply when the car is driven by a person who is not excluded but who is not listed as an additional driver. They also apply if they are under 21, aged 21 to 24 and have not held an Australian license for at least 2 years.
  • AAMI: If the driver is 25 years or over but have held their driver's licence for less than two years and are listed on insurance, the excess is $400. If they are not listed, the inexperienced driver excess is $1,400.
  • Coles: There is an inexperienced driver excess of $1,200 which applies when the driver of the car has not held an Australian drivers licence for more than two years and is 25 or older. There is also an age excess and an unlisted driver excess.
  • Woolworths: There is an additional excess for an undeclared young driver (under the age of 25) and for an inexperienced driver over 25 years of age who has not held an Australian license for at least 2 years.

Are unlisted drivers still covered?

In most cases, yes. However, you will generally have to pay an additional excess if they are involved in an accident, which can be more than $2,000. There is also generally an age excess charge if they're under 25.

If someone plans to use your car regularly, then the best option is to list them as an additional driver; that way, you don't need to worry about the huge excess. Keep in mind though that there are some insurers who will charge you an additional excess regardless of whether they are listed or not. Some insurers also won't cover unlisted household members. Be sure to read your product disclosure statement to make sure there are no exclusions like this if you are an unlisted driver.

Does it matter if an unlisted driver gets in an accident?

If an unlisted driver gets in an accident, and you have given them permission to drive, you'll probably have to pay your standard excess as well as an additional unlisted driver excess in the region of $2,000. Other policies however, will void your car insurance if a driver isn't listed. You should always check with your provider as to how listed and unlisted drivers are taken into account.

While CTP car insurance provides protection regardless of who is driving your car, some will only cover the drivers nominated on your policy. Some unlisted driver exclusions include no cover for damage, loss or liability arising out of the use of your car:

  • By any household member not listed on your car insurance certificate
  • If your car has an age restriction to help reduce your premiums
  • By anyone driving your car without your permission, unless reported to the police

Do I need to list everyone that drives my car?

If someone plans to use your car frequently, you should list them on your insurance certificate. It's also a really good idea to list all household members, provided they plan to use the car, as car insurers might exclude unlisted drivers outright. The only time it's not worth listing someone on your car is if they rarely use it.

The easiest way to avoid unwanted additional excesses or a claim refusal, is not to let any unlisted person drive your car. However, if you live with someone who shares the car, it's probably worth listing them on your insurance certificate. You'll pay more but it provides them with the same services and protection as you. It could also save you heaps in the long run.

How do I add an additional driver to my car insurance?

If you already have a policy, you can phone your car insurance provider and ask them to add an additional driver to your policy. They'll usually be able to add them on straight away. Your premiums will go up, especially if they're a younger or less experienced driver.

Alternatively, you can compare car insurance providers for a deal that works best for you. When you're filling out an application, you'll have the option of adding an additional driver to your policy. All you need to do is add their details and the insurer will calculate your premiums.

Compare policies and get car insurance

Name Product Roadside Assistance Accidental Damage Storm Choice of Repairer Agreed or Market Value
Budget Direct Comprehensive
Agreed or Market
Finder's summary: Awarded the 2019 Finder Award for the Best Value Car Insurance, this policy offers solid coverage at a low cost plus you will get 15% discount on first year's premium when you take out a policy online. Budget Direct’s claims service has received a 4.2/5 based on nearly 5,000 customer reviews.

Who it might be good for: People who want a comprehensive policy without breaking the bank.
Bingle Comprehensive
Finder's summary:Bingle consistently comes up as one of the cheaper insurers out there. It only covers the basics, so you don't get to choose your own repairer, you're not covered for personal items in the car and unless you add it as an option, you won't get a hire car if your car is stolen. But this keeps its premiums low.

Who it might be good for: Someone who wants a low-cost option that covers them for the basics.
Coles Comprehensive
Agreed or Market
Finder's summary: Coles have two-tiers of comprehensive car insurance to choose from. You'll earn double flybuys points at Coles supermarkets and you can get $10 off your Coles grocery bill every time you redeem 2,000 Flybuys points. If you're over 30, you can get roadside assistance free for a year.

Who it might be good for: Coles customers and Flybuys collectors.
Poncho Comprehensive
Finder's summary: Poncho works like a monthly subscription – you pay monthly and can cancel and leave at any time. You can also list multiple cars and drivers under one policy, making it ideal for families and groups living together under one household.

Who it might be good for: People who want their car insurance month to month.
Woolworths Comprehensive
Agreed or Market
Finder's summary: Woolworths catches our eye due to some unique perks like a price-beat guarantee, where it'll beat any current comparable comprehensive renewal notice if you're over 25. You'll also get 10% off your grocery shop once a month and can add roadside assistance onto your policy for just $7.35 per month.

Who it might be good for: Woolworths shoppers and those that want to take advantage of its price-beat guarantee.
Qantas Comprehensive
Agreed or Market
Finder's summary: You'll be able to choose how comprehensive you want your cover to be with optional extras like choice of repairer and the option of agreed or market value. Plus earn Qantas Points for joining and paying your premium. Sign up by 2 May 2021, you can earn up to 30,000 Qantas Points (points awarded will be based on your premium). T&Cs and eligibility apply.
ahm Comprehensive
Finder's summary: ahm comprehensive car insurance lets you choose higher excess to reduce your premiums plus you can get up to 15% off when you purchase a new car insurance policy. T&Cs apply. Additionally, their Fixed Kilometre Plan can save you up to 30% compared to their standard comprehensive cover.

Who it might be good for: People who drive less than 15,000 km per year.
Virgin Comprehensive
Agreed or Market
Finder's summary: Finalists for the 2019 Finder Awards for Best Value Car Insurance, Virgin Comprehensive provides a good level of cover for a decent price. Get 15% off on your first year’s premium when you purchase a new eligible comprehensive car insurance online. T&Cs Apply.
QBE Comprehensive
Agreed or Market
Finder's summary: QBE is a sustainable insurance company and also Finder's Green Insurer of the Year 2020 Award winner. This policy offers the highest level of protection available from QBE including three-year new car replacement. You can also save $75 when you purchase a new comprehensive policy online. T&Cs apply.

Who it might be good for: Those that are looking for a more environmentally friendly insurance choice.
Stella Comprehensive
Agreed or Market
Finder's summary: Stella’s a female-focused insurer. It'll cover you if your car is damaged as a result of domestic violence. It offers higher cover for baby gear than most, with up to $2,000 cover for prams, strollers and child seats. Get $50 cash back when you purchase online between 1 April – 30 June 2021 using the code STELLA50. T&C apply.

Who it might be good for: Someone who wants a female-centred car insurance policy (it will cover men too).
Youi Comprehensive
Agreed or Market
Finder's summary: Youi Comprehensive Car Insurance is one of the few providers to include roadside assistance in its policy. You'll also get access to YouiRewards which gives you discounts on furniture, parking and more. Youi also has a live chat feature on its site to talk through any questions.

Who it might be good for: People over 25 who want comprehensive cover with a focus on customer service
Australia Post Comprehensive
Agreed or Market
Finder's summary: Australia Post car insurance offers comprehensive cover for things like theft, fire, new for old replacement and emergency accommodation and transport. Cover also extends to anyone who uses your car, not just you.

Who it might be good for: If multiple people use the one car and you don’t want to worry about listing all drivers.

Compare up to 4 providers

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