Do I need car insurance? | finder.com.au

Do I need car insurance in Australia?

CTP is the only form of car insurance that's compulsory in Australia. But does that mean you should skip all other cover?

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Everyone needs to have compulsory third party car insurance (CTP), but do you need more than that? Well, not legally. But it's definitely a good idea to have at least third party property damage cover. This would save you from forking out your own cash if you crash into a pricey Mercedes.

If you can afford it, comprehensive car insurance is always the better option, especially if you can't afford to pay for a new car straight up or you've spent a bit of cash on your car already.

Is car insurance compulsory in Australia?

In Australia, you must insure each registered vehicle with CTP insurance, sometimes known as a Green Slip.

You buy your policy from one of a handful of insurers your state has selected to take part in its CTP scheme and all of these state-regulated policies cover you for the medical bills of anyone you injure in an accident. Some states will cover some of your medical bills, even when you're at fault.

In most states, your Green Slip automatically comes with your registration but you have to organise it on your own if you're in NSW, ACT or QLD.

In a nutshell, CTP keeps you from owing money for other people's medical bills.

Do I need any additional insurance in Australia?

CTP is the only form of insurance that's compulsory, but does that mean you should skip out on the rest?

If you're without insurance and cause a three-car pile-up, you'll have to cover thousands of dollars for repairs from your own pocket. Find that someone has damaged your car and you're not at fault? You'll still have a really hard time getting your money back.

Even though other forms of insurance aren't compulsory, if you want to stop yourself from being in some crazy money troubles, it just makes sense to get extra cover. Here's why:

  • Damaging someone's property can be expensive. Causing an accident can be expensive. Even if you forget about the damages to your car, you'll still be responsible for damaging other people's cars plus any other property you can think of, like road signs, bus stops, homes, lawns, shopfronts and animals.
  • There's often no one else responsible when your car is damaged. If replacing your car would hurt your wallet, consider these situations where CTP won't pay for your car: you cause the accident, an uninsured driver hits you, someone hits you and drives off, someone steals or vandalises your car or there's a natural disaster like a flood or hailstorm.
  • Your bank may require it. If you borrowed money for your car, your lender might insist that you take up additional cover to protect the loan.

Protect future you and get car insurance

Name Product Roadside Assistance Accidental Damage Storm Choice of Repairer Agreed or Market Value
Budget Direct Comprehensive
Optional
Optional
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.
QBE Comprehensive
Optional
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.
Bingle Comprehensive
Market
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
Optional
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
Agreed
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.
Qantas Comprehensive
Optional
Optional
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
Optional
Both
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
Optional
Optional
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.
Stella Comprehensive
Optional
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
Optional
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
Real Comprehensive
Optional
Agreed or Market
Finder's summary: Real Comprehensive Car Insurance provides similar coverage to other insurers for the important stuff like looking after your car if it's stolen or you crash. They're also one of the few insurers who offer a Pay As You Drive policy, so you might be able to save big if you don't drive much.

Who it might be good for: Those that don't drive much can take advantage of their Pay As You Drive policy.
Australia Post Comprehensive
Optional
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.
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Compare up to 4 providers

Name Product Damage to your Car Damage to Other People's Car Pay Monthly At No Extra Cost Legal Liability
Budget Direct Third Party Property Damage
$20,000,000
Save 15% on your first year's premium when you purchase a new policy online. T&Cs apply.
Bingle Third Party Property Damage
$20,000,000
QBE Third Party Property Damage
$30,000,000
Coles Third Party Property Damage
$20,000,000
Save 10% when you buy online. T&Cs apply.
Qantas Third Party Property Only
$20,000,000
Earn Qantas Points when you sign up. T&Cs apply.
Virgin Third Party Property Damage
$20,000,000
Purchase a new eligible Virgin Car Insurance policy and you'll also save 15% on your first year's premium. T&Cs Apply.
ahm Third Party Property Damage
$3,000
$20,000,000
Youi Third Party Property Damage
$20,000,000
Emergency roadside assistance included in Comprehensive policies.
Real Third Party Property Damage
$20,000,000
Save up to 10% when you buy online.
Woolworths Third Party Property Damage
$20,000,000
Buy online and save up to 15%. Plus, Everyday Rewards Members will save 10% on their monthly shop. T&Cs apply.
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Compare up to 4 providers

What are my car insurance choices?

Generally speaking, you can choose between three types of additional insurance to go along with your CTP. These are:

  • Third party property damage (TPPD). This covers any damage you cause to anyone's property but your own, including cars, homes, land, pets and personal items.
  • Third party fire and theft (TPFT). This covers everything TPPD does plus two specific events that cause damage to your car: when it catches fire or when someone steals it. It doesn't cover your car when you cause a crash or when it's damaged by any other type of natural disaster besides fire.
  • Comprehensive. This covers you for everything TPPD and TPFT does, plus all other ways your car can get damaged: storms, natural disasters, vandalism, uninsured drivers, hit-and-runs and even crashes you cause.

What car insurance do I need for my car?

Everyone needs some form of additional insurance in case they damage someone's property, but only certain people will need more than that. It really depends on the individual, since not everyone has the same car or the same driving record.

Here are some questions you can ask yourself to determine which level of cover is right for you:

  • Do you owe money on your car? If you're still paying for your car, there's a good chance your lender will require you to have comprehensive car insurance because that's the only level that fully covers your car. Even if not, you should strongly consider comprehensive cover so you don't need to take out a second loan to replace the vehicle.
  • How much is your car worth? If replacing your car wouldn't break the bank, you can get away with third party property cover. It won't cover your car, but will help you avoid massive bills if you crash into someone else's.
  • Do you drive often or rely on your car? If you're on the road a lot, comprehensive car insurance can swoop in to help if an accident leaves your car undriveable. For example, it can provide you with a hire car while yours is in the shop and put you up in a hotel if you're stranded far from home.
  • Where do you live? If you live in an area that's prone to natural disasters, you should get a level of insurance that will cover those specific risks. Third party fire and theft will help out if you live in a bushfire-prone area. If you live in a flood zone or somewhere that experiences cyclones, you'll need comprehensive cover.

Do I need comprehensive car insurance on an old car?

Everyone should have some level of additional car insurance on top of their CTP, including those who drive old cars. An old car can cause just as much damage to a BMW as any other car on the road, maybe even more so, since older cars tend to be heavier.

That's why you should definitely consider getting at least third party property protection.

You should also consider whether or not you'd be in the financial position to replace your car if it was damaged. If replacing your old car would be too much of a burden, getting third party fire and theft or comprehensive cover will take away some of that burden.

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4 Responses

    Default Gravatar
    corrineFebruary 10, 2019

    I am in QLD on WHV 417 and want to buy a car to travel around the country. If I buy a car i understand i must register it as the new owner – do you know how much that is? and then I must insure it with a green slip if I sort this in QLD am I then covered for insurance across all australia?

      Avatarfinder Customer Care
      JohnFebruary 11, 2019Staff

      Hi Corrine,

      Thank you for reaching out to finder.

      Depending on the vehicle number of cylinders, your vehicle registration in QLD may range from $350-$670. The rules of CTP insurance vary from state to state. For example, drivers in New South Wales, Queensland, South Australia and the Australian Capital Territory have the power to choose their CTP/Green Slip insurance provider. All vehicles in Australia must have CTP insurance before they can be registered and legally driven in any road in Australia. Hope this helps!

      Cheers,
      Reggie

    Default Gravatar
    SueNovember 20, 2018

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

      Default Gravatar
      NikkiNovember 20, 2018

      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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