driving on mountain ridge

Do I need car insurance?

How to work out whether or not you need car insurance.

Try asking yourself a couple of questions.

  • Do you have a car?
  • Does it drive on the road?

If you answered yes to both those questions, then you need car insurance.

1. Some car insurance is mandatory

The mandatory car insurance in Australia is compulsory third party car insurance (CTP).

This covers pedestrians, cyclists, your passengers and anyone else unlucky enough to get in your way, against disability, injury, death and that fun stuff.

And it can also cover you against being sued into the ground after running someone over, injuring one of your passengers in an accident or similar.

In most states it’s automatically included in your car registration. The exceptions are NSW, the ACT and QLD where someone thought it was a good idea to make you buy it separately - thanks, guys.

2. The rest isn't mandatory - but it just makes sense

Other than CTP, you technically don’t need car insurance. It’s perfectly legal to hit the road without any other cover.

But that doesn't mean it's a good idea to go without.

It’s safe to say you’ll want extra liability cover. In car insurance, this is known as third party property damage cover (hereafter referred to as TPPD for brevity).

This is basically like CTP insurance, except for damage to cars and other property, rather than damage to people.

If you’re driving along and a house suddenly gets in your way, it’s safe to assume that the owner of that house will be going after your wallet with a vengeance. With third party property damage cover, your insurance company may take the hit in your place.

It works the same for houses as it does for other road hazards like BMWs. Scratch the paint on one of those and it’s on you.

You don’t want to know how much that stuff costs, and with liability insurance you might not have to find out.

Long story short, you probably need car insurance. Start your search here.

Name Product New Car Replacement Pay monthly at no extra cost Choice of repairer Roadside Assistance Hire car after theft Personal effects
Optional - If your car is written off in the first 3 years
No
No
No
Optional - Up to $50 a day until your claim is settled
$0
Save 24% on your policy if you've been claim free for 3 years.
Yes - If your car is written off in the first 2 years
Yes
No
Optional
Yes - Up to $70 per day (Max 14 days)
$500
Transforms your driving so it's 100% carbon neutral.
Yes - If your car is written off or stolen in the first 2 years
No
Yes
Yes
Yes - Reasonable costs (Max 14 days)
$750
Emergency roadside assistance included in Comprehensive policies.
Yes - If your car is written off in the first 2 years
No
No
Optional
Yes - Up to $70 per day (Max 14 days)
$500
Save up to 10% when you buy online.
Yes - If your car is written off in the first 2 years or is under 40,000 km
No
Yes
Optional
Yes - Up to $1,000 (Max 14 days)
$250
Buy online and save 15%.
Yes - If your car is written off in the first 2 years or is under 40,000 km
No
Yes
Optional
Yes - Up to $1,000 (Max 14 days)
$500
Save 15% when purchasing online. Plus receive up to 20,000 Velocity Points when purchasing a new eligible policy by 1 April 2019. Min 6 months policy and T&CS apply.
Yes - If your car is written off in the first year or is under 20,000 km
No
No
Optional
Optional - Up to $60 per day (Max 14 days)
$500
Save up to 20% on car insurance when you purchase cover online.

Compare up to 4 providers

When you may or may not need car insurance

CTP is mandatory and TPPD is a really good idea, but neither of those will really cover damage to your own car.

That’s what comprehensive car insurance does. Hail, flood, fire, vandalism, theft, accident, accidental vandalism by hailstone-wielding thieves, etc.

Conveniently, it also includes TPPD cover, so you don’t need to shop for that separately.

Instead, all you have to do is decide whether it’s worth paying extra for comprehensive car insurance, or if you just want the cheaper TPPD only.

How do I decide what policy is best for me?

As a general rule, the worse your car is the worse your insurance can be. If you’re driving a motorised wheely bin, you might as well stick with TPPD only cover. And nice job getting that thing roadworthy and registered.

If you really can’t go without your car, like if you need it to drive to work and will get fired without it, then comprehensive car insurance might be worth it, just to help make sure you can get it repaired fast if needed.

Or if it’s a brand new car, or just a nice car, then your comprehensive cover might also be well worth it.

How to get cheaper car insurance

The two top tips for cheaper car insurance are:

  • Buy online: You were most likely going to do this anyway. But if you weren’t, you probably should. Insurers don’t like dealing with too much paperwork or too many phone calls, and so will offer straight-up discounts just for you if you buy online.
  • Shop around: If there are ten different insurers, and you get five different quotes, there’s only a 50/50 chance that you’ve seen the cheapest. There are way more than ten insurers in Australia.
  • Try a price beat deal: Sometimes insurers will offer to match competitor prices. You might keep one of those up your sleeve and then go for it once you’ve finished shopping around.

Picture: Unsplash


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Andrew Munro

Andrew writes for finder.com, comparing products, writing guides and looking for new ways to help people make smart decisions. He's a fan of insurance, business news and cryptocurrency.

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2 Responses

  1. Default Gravatar
    SueNovember 20, 2018

    Can you insure the car you are driving if it is not registered in your name/

    • finder Customer Care
      NikkiNovember 20, 2018Staff

      Hi Sue,

      Thanks for reaching out! You may certainly insure a car you’re driving that’s not registered under your name. Non-owner car insurance allows you to drive someone else’s car and be protected.Typically this insurance only provides liability coverage, not optional coverage like damage to the car, rental reimbursement or medical expenses. Do your research by viewing this list of car insurance providers on our page and ask if they offer this type.
      As a friendly reminder, carefully review the Product Disclosure Statement of the product before applying. You may also contact the insurance provider should you have any questions about their policy.

      Hope this was helpful. Don’t hesitate to message us back if you have more questions.

      Best,
      Nikki

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