There's no reason to pay through the roof on your insurance if you don't need to. If you're trying to save cash, there's a bunch of car insurance options that might suit you.
You can opt for a bare bones third party policy, or if you want more cover, there's lots of budget insurers out there that might have what you're looking for. Whatever the reason, it's not hard to find cheap cover that works for you.
How much does car insurance cost?
We got quotes for a bunch of Australian car insurers and found some huge differences in how much car insurance can cost across different companies and different policies. All of these costs have the exact same car and driver. The costs are broken down monthly.
You can see that the difference between a third party and a comprehensive policy can reach up to $66 a month! If you are opting for a third party policy, it's important to compare policies as the difference between similar policies can be almost $20 a month!
If you want a higher level of coverage, our research says that AAMI, Huddle, and Budget Direct are some of your more affordable options. Policies can differ by $16 a month - or almost $200 a year! Keep in mind that some of these cheaper policies might not cover as much as the more expensive policies, but if you just want to make sure you're protected in an accident without breaking the bank, they could be a good option.
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To determine this estimated cost, we sourced quotes using this profile:
- We averaged together the cost of a male and a female policy, both born on 1/1/1983
- 2016 Ford Falcon
- Comprehensive car insurance
- Lived in Sydney, NSW
- Drives 10,000 - 15,000 kilometres per year
- Adjusted excess to $600-$700 where possible
- Safe driver with no claims made in the past 3 years
- Quotes sourced on 20 November 2018
Your cost will differ depending on your circumstances. Some things that can affect the cost of your quote include your gender, the type of car you drive, the colour of the car, how long you have been driving, the amount of cover you need, plus more. Be sure to read the PDS to find cover that suits you.
Since the cost of car insurance varies so much from person to person finding the cheapest car insurance in Australia is not as simple as looking at a list and sorting it from lowest to highest. However, there are certain ways that you can save and get cheap car insurance:
- Restrict drivers. When you're getting a car insurance quote you'll be asked if you want to restrict drivers under a certain age. Choosing not to let young drivers behind the wheel of your car can save you big bucks on your car insurance.
- Take the higher excess. If you're okay covering a bit more should you get into a prang, opting to pay a higher excess will help you save on your car insurance premiums.
- Keep your car in a garage. Want to pay less for car insurance? Then keep your car in a garage or at the very least in off-street parking. Cars on the street are exposed to higher risks of theft and damage and as such pay more for car insurance.
- Insuring more than one vehicle. If you and your partner both have vehicles that need insurance, look to take out your car insurance with the same insurer. You can get cheaper insurance by bundling your policies.
- Insuring more than just your car. Check to see if your home or life insurer also offers car insurance. If they do they may offer multi-policy discounts, which means getting cheaper car insurance.
- Comparison shopping. Since you're on Finder you're already doing this step. Comparing your options is the only way to make sure you're getting the best bang for your buck.
- Pay your premium annually. Some car insurers will offer discounts if you're able to pay your annual premium upfront rather than in monthly instalments.
- Look for an insurer that offers no claims bonuses. If you're a good driver then you can really benefit from finding an insurer that offers no claims bonuses. With each year you have a clean claims record, your premiums will be discounted.
- Pay-as-you-go. Pay-as-you-drive insurance policies are available from a handful of car insurance companies in Australia and provide a cheaper alternative to standard car insurance policies for people who seldomly use their vehicles.
- Loyalty doesn't always pay. If you've been with your insurance company for a while and it's time for your renewal ask them if they can give you a better price. If they say no, you can compare your options and walk if you find a cheaper policy.
What's the cheapest type of car insurance?
Third party property damage is normally the least expensive option if you're looking for the absolute cheapest car insurance. However, there are a couple of other options you might want to consider if you need higher cover.
Here's a breakdown of the cheapest car insurance policies and what they cover you for:
- Compulsory third party insurance (CTP): This is mandatory car insurance that you must have in order to get your car registered. It covers injuries and deaths suffered on the road, but no vehicle damage of any sort. The cost of this is automatically added to registration everywhere except NSW, where you have to buy it separately.
- Third party property damage (TPPD): Third party car insurance covers damage you cause to other cars and property. It won't cover any damages to your own car.
- Third party fire and theft (TPPD F&T): This type of car insurance typically costs more than just TPPD, but also covers your own vehicle from damage, specifically, damage or loss from fire and theft, two of the most common vehicle hazards. It generally costs more than TPPD alone, but still less than comprehensive car insurance, and offers a balanced level of cover.
Watch: What type of car insurance policy do you need?
Which cars are the cheapest to insure?
Generally, newer model cars are less expensive to insure.
This is because they're often made by Australian manufacturers with an expansive network of approved mechanics and service locations, and also because they have inexpensive and widely available spare parts.
In addition, the least expensive cars to insure, particularly for young drivers, are generally the safer, less expensive and less powerful ones.
Based on our analysis of 14 vehicles, the cheapest 3 cars to insure were:
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