Types of Car Insurance
Find out more about the different types of car insurance available in Australia and compare quotes online.
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Car insurance is a crucial part of owning a car, but with so many different types of policies and offers available, it isn’t always easy to know which one is right for you. Understanding the different types of car insurance can help you make an informed decision about the level of coverage you need to protect yourself and your vehicle.
From comprehensive to third party insurance, read more about the options on offer to help you determine which is the best for your needs and budget. If you're ready to buy your policy, you can compare instant online offers today.
What are the different types of car insurance and what do they cover?
There are four main types of car insurance available in Australia, each of which offers different areas of coverage. What they do and don’t cover is as follows:
| Does the provider cover you for: | Comp. | TPFT | TPPD | CTP |
|---|---|---|---|---|
|
Damage to someone else’s property |
✓ |
✓ |
✓ |
✖ |
|
Damage to your car due to fire |
✓
|
✓
|
✖ |
✖ |
|
Damage to your car due to theft |
✓
|
✓
|
✖ |
✖ |
|
Damage to your car due to weather |
✓*
|
✖ |
✖ |
✖ |
|
Damage to your car due to accident or collision |
✓ |
✖ |
✖ |
✖ |
|
Injury or death of someone else in an at-fault accident |
✖ |
✖ |
✖ |
✓
|
*Not all weather-related incidents are covered under a comprehensive car insurance policy. Check your PDS to find out what's covered and what isn't.
It’s important to note that insurers have a range of exclusions which are outlined in your product disclosure statement (PDS), meaning you won’t necessarily be guaranteed coverage when making a claim. As such, it’s important to check your policy documents carefully so you can be aware of what you can and can’t apply for under your car insurance policy.
What is comprehensive car insurance?
Comprehensive car insurance is the highest level of protection you can take out for your vehicle in Australia. It can cover you for damage to your car, as well as damage to other people’s vehicles and property. In addition to collision damage, comprehensive car insurance can also cover damage due to events such as theft, vandalism and extreme weather like hail or floods.
Some policies may also include additional benefits such as rental car coverage, emergency roadside assistance, hire car cover and windscreen replacement. Comprehensive car insurance is typically the most expensive type of car insurance on the market, but provides the most extensive coverage for your vehicle.
What is third party car insurance?
Third party car insurance is a type of car insurance which covers the cost of damage you may cause to someone else's property or vehicle. In Australia, there are two types of third party car insurance cover: third party property damage and third party fire and theft.
Third party property damage (TPPD) insurance can provide coverage for damage you may cause to someone else's property or vehicle in the event of an accident. This type of insurance doesn’t cover any damage to your car, which typically makes it the most affordable optional insurance policy for drivers.
Third party fire and theft (TPFT) insurance, on the other hand, provides coverage for damage to someone else's property or vehicle as well as damage to your own vehicle caused by fire or theft. This type of insurance is generally more expensive than third party property damage insurance, but it offers greater protection (namely for your vehicle).
It's important to note that both types of third party car insurance policies do not cover any damage to your vehicle caused by an accident. If you want coverage for damage to your vehicle, you’ll need to take out a comprehensive car insurance policy.
What is compulsory third party car insurance?
Compulsory third party (CTP) car insurance, also known as green slip insurance, is mandatory in Australia for all registered vehicles. This insurance provides cover for personal injury or death caused by a vehicle's owner or driver to other road users. It doesn’t cover any damage to property or other vehicles, nor does it cover the driver or owner of the vehicle for any injury or damage caused to themselves or their vehicle.
Each Australian state and territory has its own regulations for CTP insurance, and the cost and coverage of CTP insurance can vary depending on the state or territory in which the vehicle is registered. Additionally, you may be able to purchase this either from your state or territory government directly (such as in Victoria) or from a list of approved insurers.
Types of car insurance you can choose from
The most basic type of optional cover available, TPPD insurance can offer protection for damage caused by your vehicle to other people's property. However, no damage to your vehicle will be covered.
A step up from TPPD, TPFT insurance can also cover damage to your vehicle sustained due to a fire or theft (or attempted theft) in addition to third-party property damage if you're in an at-fault accident.
The most extensive (and expensive) form of cover, comprehensive car insurance can also offer cover for damage to your vehicle in an accident, collision and certain weather events on top of the areas TPFT covers.
How to compare car insurance types and policies
Cost of premiums
When comparing car insurance types, it's essential to compare the cost of premiums. Look at the annual cost for each policy and make sure you're comparing like-for-like offers. However, while cost is important, the cheapest policy may not always be the best for your needs if it doesn’t offer the coverage you’re looking for.
Coverage and exclusions
Check the coverage provided by each policy and what's excluded. It’s crucial to be across what is and isn’t covered, as well as any limits which may apply to your coverage, before purchasing your policy.
Bonuses and discounts
Consider the bonuses and discounts available with each policy. For example, some insurers may offer a no-claim bonus, which could reduce your premiums over time. Other bonuses could include loyalty rewards, discounts for paying annually or simply for signing up.
Excesses
Check the excess payable under each policy. The excess is the amount you may need to pay if you make a claim. A higher excess can reduce the cost of premiums, but you'll need to pay more if you make a claim.
Optional extras
Consider the optional extras available with each policy. For example, some insurers may offer extra cover for your personal contents or windscreen. Others may offer additional hire car cover or accommodation if your car is stolen or written off. Consider which optional extras you need and whether they're worth the additional cost.
Common questions about the types of car insurance in Australia
Helpful guides on car insurance
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Disclaimer:
Savvy (ABN 78 660 493 194, ACR 541 339) provides readers with a variety of car insurance policies to compare. Savvy earns a commission from our partnered insurers each time a customer buys a car insurance policy via our website. All purchases are conducted via our partners’ websites. The integrity of our comparison service is unaffected by our partnerships with those businesses and our effort remains to bring further brands that do not already use our comparison service onboard.
Savvy’s comparison service includes selected products from a panel of trusted insurers and does not compare all products in the market. Any advice presented above or on other pages is general in nature and doesn’t consider your personal or business objectives, needs or finances. It’s always important to consider whether advice is suitable for you before purchasing an insurance policy. We always recommend readers to consult the Product Disclosure Statement (PDS) of different policies before purchasing your car insurance.