So, you have just come across a new car. It’s not as shiny as some of the other cars on the road, and even though you’re pretty sure the person who sold it to you lied about the mileage, you’re still happy that you finally have a vehicle to call your own. Naturally, you want to look after this vehicle, but you are aware accidents happen. So you decide to try and take out a car insurance policy.
And then things get intense.
Insurance is a complicated and often misunderstood business, especially in the world of cars. Cars are expensive things to purchase, and the cost of insurance seems to be an added burden. Furthermore, the more you look at the terms and conditions, the more absurd everything seems: these insurance companies seem to have absolutely no relevance to your situation at all (why would I care about retirees and insurance options for geriatrics? I’m still at university!).
But you do need car insurance. After all, in July 2015, there were 91 road related deaths in Australia alone (ABS statistics), which isn’t even including the non-fatal accidents which seem to constantly be on our radios. Roads are dangerous places – especially considering you are driving a complex piece of machinery powered by explosions.
Back to the matter at hand: you are confused about how car insurance works in Australia. Here is a very, very basic overview that should help you by showing you some of the basic types of car insurance.
To complicate all matters before we begin, it should be noted that each of the states and territories have different laws and regulations when it comes to car insurance. One thing that is common to all of Australia, however, is the Compulsory Third Part (CPT) Insurance, which covers injuries caused by vehicles. As the barest minimum level of insurance that is covered by the law, there is absolutely no cover for the vehicle itself, as it only covers the potential injuries of other people.
The CTP covers, as is implied, anyone injured who is not the actual driver responsible for the crash. For example, a person who hits a pedestrian and runs into a car and truck via a cyclist will not be personally responsible for the costs of any medical bills that arise from their (rather spectacular) accident.
Whilst the CTP is common to all states in Australia, the process of getting your “green slip” as it is colloquially known as does vary. Make sure you have checked your state or territory government’s policy to get the basic level of coverage.
Although there are many different types of car insurance schemes out there, there are several common types that can be found across Australia. These include:
Please note that there will be other types – but these are the options that you will most likely encounter.
We understand that car insurance in Australia can be confusing and alarming at times. This is why this brief introduction has helped clarify things up for you. We also understand that there can be often an overwhelming number of options to choose from, which can be very confusing for someone who doesn’t deal with insurance every day.
Fortunately there are ways to compare car insurance in Australia that are quite easy to use. An example of this is in the company called “Rate City”, which engages in all aspects of comparing insurance schemes to find the best match for your unique circumstances. Rate City, as well as other insurance comparison websites, bring together some of the biggest names in the insurance world.
In conclusion, hopefully you’re a little less confused by car insurance options now. Having an understanding of what options are out there can really make all the difference when it comes to finding the right coverage for you.