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Uninsured motorist benefit
Protection for your vehicle even if you don't have comprehensive cover.
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If you're on the roads in Australia, there's a good chance you have some form of insurance be it comprehensive, third party property damage (TPPD), third party fire and theft (TPFT) or compulsory third party (CTP) insurance. But what happens when the person you're in an accident with doesn't have insurance?
Car insurance data from the 2015–16 General Insurance Code of Practice Report shows that there could be around 4 million uninsured drivers on Australian roads. If one of them collides with you, you may not be able to claim the damage if you don't have comprehensive car insurance.
Uninsured motorist benefit is a cover option you may want to consider. Read our breakdown to find out if it's right for you.
What is an uninsured motorist benefit?
While all car insurance policies provide cover if you should be at fault in a collision with another car, covering the majority of costs from damage, unless you have comprehensive car insurance you have no protection if someone else damages your vehicle. Most drivers generally have some level of insurance, but if they don't there may be no way to recoup the costs involved in an accident.
Uninsured motorist benefit is an option provided by most car insurance providers, which provides limits cover should an uninsured motorist be 100% at fault in a collision with your vehicle.
When does this type of cover come into effect?
If you're in a collision and the other driver is totally at fault and doesn't have insurance, you can contact your insurance provider and make a claim for the damage or injury. The benefit doesn't apply if you're in any way at fault.
Which policies have this benefit?
Cover will vary from insurer to insurer. However, uninsured motorist benefit is typically included in comprehensive cover or available as an optional extra. TPPD and TPFT policies usually offer uninsured motorist benefit as additional cover and often increase your premium. This is due to the added risk of another motorist being at fault in a collision with you, rather than only your personal risk of an at-fault collision being assessed.
How much cover do these policies offer?
Cover varies depending on your policy and any additional cover. On average, insurance providers offer up to $5,000 to cover any damage and towing costs. However, this amount can be higher for comprehensive cover. If you have this benefit through a TPPD or TPFT policy, this amount can be negotiated if your car has a higher value. Be sure to discuss cover limits for uninsured motorist benefit with your insurance provider before you take out a policy.
What are your options when claiming this benefit?
Unless you have comprehensive cover, your options are limited. As standard, the insurer offers the limited amount no matter the extent of damage, additional charges or if your car is considered a total loss.
What should you do following an accident?
If you're involved in an accident where the other driver is at fault and uninsured, first take any possible measures to get to a safe distance from traffic, prevent any further damage or injury and contact any emergency services required. Collect the details of the driver(s) involved, including names, addresses, contact numbers, email addresses, driver's licence and registration numbers. If there are any witnesses to the accident, collect their information as well. Contact your insurance provider as soon as possible to lodge your claim and access any additional benefits your policy gives you.
For more details, read our guide to what to do after a car accident.
Bottom line
We all feel like competent drivers. We all do the right thing and get appropriate car insurance to protect against accidents and unexpected bumps on the road. But there are some still on the roads without insurance and unless you have comprehensive cover, you'll be naked against the cost of a collision with an at-fault uninsured driver. Be sure to ask your insurance provider about their uninsured motorist benefit and consider if it's right for you.
Want to protect your car? Get comprehensive car insurance
Comparing car insurance will not only make sure that you get the right price, but also, that you get the right product. When choosing a policy, don't forget to check out the Product Disclosure Statement to make sure it suits your needs.
Picture: Unsplash
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