The 10-minute phone call that could cut your car insurance bill
Key takeaways
- Car insurance renewals are rising again, with many comprehensive policyholders reporting increases of around 10%.
- Insurers recalculate premiums from scratch each year, so your renewal price is effectively a brand new quote.
- What's next: Before your policy rolls over, get a comparison quote and call your insurer to ask for a better price.
If your car insurance renewal just landed with a number that nearly put you into cardiac arrest, it might be comforting to know you're not alone.
Comprehensive car insurance policies have reportedly risen by 10% from previous years, making it even tougher for Aussies to keep their set of wheels covered.
But rather than letting your cover auto-renew, there is a chance to cut the cost.
Why are car insurance premiums rising so drastically
Many car insurers recalculate premiums from scratch every year, using the latest data on claims, repair costs and local risk to build fresh quotes — so it's a combination of factors, not just your driving habits.
The Insurance Council of Australia said claims costs are up from around 42% from 2019 to 2024.
Modern cars with all the bells and whistles could also be contributing to the rise in repair costs. For example, a minor bump that once simply meant a new bumper can now mean recalibrating cameras, radar sensors and driver-assistance systems.
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Your sign to pick up the phone before you pay
The biggest mistake you can make at renewal time is doing nothing at all.
Back in August, we reported on ASIC's latest findings that revealed nearly a third of people who contacted their insurer before renewing got a lower price without changing their cover.
While insurers do openly advertise sign up deals for new customers, they're just as committed to hold on to existing ones.
Before you call, get a quote or two for similar cover elsewhere so you know what's on offer.
Then follow this script:
- Call your insurer. Have your policy number and your comparison quote handy.
- Tell them you're shopping around. "I'm comparing policies before my renewal and I've noticed cheaper premiums available for similar cover. I've been quoted $X elsewhere."
- Ask if they can match it. "Can you match or beat that price for the same level of cover?"
- Stay if they say yes (if you're happy with the price). Ask them to confirm your cover, excess and inclusions haven't changed.
- Switch if they say no. Check the new policy covers what you need, and don't cancel your old one until the new policy has started.
Either way, if your insurer can't offer a better deal, you're not locked in. You can compare car insurance policies on Finder to see if another policy gives you the cover you need for less.
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