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Learn about the common factors that could void your car insurance with Savvy.
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Car insurance provides protection and peace of mind in the event of unexpected accidents or damages. However, various factors can lead to your policy being voided, leaving you exposed to significant risks. It's important to be aware of the impact your actions could have.
In this informative guide, Savvy explores the common reasons why car insurance policies may become void in Australia. We delve into actions and violations that can result in the loss of coverage, and examine the potential consequences.
When your car insurance is voided, it means that the policy loses its legal effect and it is treated as if it never existed. This typically occurs when the policyholder breaches certain terms or conditions outlined in the policy, such as providing false information, failing to disclose important details or engaging in fraudulent activities.
After a car insurance policy is voided, the insurer is no longer obligated to provide coverage for any claims, and the policyholder loses the financial protection and benefits associated with the insurance policy. This can have serious consequences, including potential legal and financial liabilities, so it’s crucial to understand the terms and conditions of your policy and comply with them to avoid the risk of voiding your car insurance coverage.
There are a number of factors that can void your car insurance coverage. Common factors include:
Unlicenced drivers
Driving without a valid driver’s licence is illegal in Australia and can void your car insurance policy. If you have an expired licence, drive a car you are not licensed to drive or let an unlicensed driver operate your vehicle, any accidents or damages that occur may not be covered by your insurance.
Driving under the influence of alcohol or drugs
Driving while under the influence of alcohol or drugs is not only dangerous but can also result in the voidance of your car insurance. If you are found to be impaired at the time of an accident, your insurance may not cover damages or injuries.
In Australia, it is illegal to get behind the wheel with a blood alcohol content (BAC) exceeding 0.05 if you hold a full driver’s licence; if you have a learner’s or provisional licence, you must not drink at all before driving.
It’s important to note that ‘drugs’ in this context can also include legal medications such as sleeping pills, painkillers and other drugs that could impair your ability to drive.
Driving a car that isn't roadworthy
Operating a vehicle that is not roadworthy – in other words, that is not in good enough condition to be driven safely – can both put you at risk and void your car insurance coverage. Your car needs to meet certain required standards of roadworthiness, including having valid registration, functioning lights, brakes and other essential components.
Driving an overloaded car
Overloading your vehicle beyond its legal carrying capacity is not only against the law but can also jeopardise your insurance coverage if you are in an accident. This not only refers to exceeding the maximum weight limits specified by the manufacturer but also to carrying more passengers than permitted and carrying a load that is improperly secured.
Damaged tyres
Driving with damaged or worn-out tyres can compromise your safety and void your car insurance. Tyres with insufficient tread depth (1.5mm in Australia), bulges, cuts or other significant damage increase the risk of accidents, so it is important to check them and replace them before they get to this point.
Wear and tear
Car insurance typically covers sudden and accidental damage rather than general wear and tear or gradual deterioration of your vehicle, which could include damage caused by rust, mould, mildew, damp or rot. Regular maintenance and upkeep are essential to prevent issues that could lead to mechanical failures or breakdowns.
Modifying your car without informing your insurer
Making modifications to your car without notifying your insurer can void your car insurance coverage. Some modifications, such as engine modifications, changes to the suspension or alterations that increase the vehicle's performance, can impact the risk profile and safety of your vehicle. It's crucial to inform your insurance provider about any modifications to ensure that your cover remains valid.
Using your car for business purposes
If you use your personal vehicle for business purposes, such as ridesharing or delivery services, you need appropriate cover. Personal car insurance policies typically exclude coverage for commercial use, so if you use your vehicle for business without the necessary insurance, any accidents or damages that occur while on business-related activities may not be covered.
Reckless acts
Engaging in reckless driving behaviours can lead to the voidance of your car insurance. This includes activities such as speeding, street racing, participating in illegal activities or intentionally causing damage. Reckless driving is a criminal offence, so as well as voiding your policy, you could face demerit points, fines and even loss of licence and jail time.
Not paying your premiums
Failure to pay your insurance premiums can result in the cancellation or voidance of your car insurance policy. It's important to keep up with your premium payments to maintain continuous coverage. If you miss payments or allow your policy to lapse, your insurer may consider your coverage void, leaving you without insurance protection.
There are many other factors that can potentially void your car insurance coverage, including:
As mentioned, when a car insurance policy is voided, it means that the policy is considered null and void, as if it never existed. The consequences of this may include:
To avoid voiding your car insurance, it's crucial to comply with the terms and conditions of your policy. Your responsibilities include:
If you believe that your car insurance may be at risk of being voided due to a change in circumstances or any other factors, it’s crucial to contact your insurer immediately. Discuss the situation with them, provide any necessary updates or information, and seek guidance on how to ensure your coverage remains valid. Prompt communication can help address any potential issues and ensure that you are appropriately protected.
Select your car make and find out how much it may cost to insure, read helpful guides and compare quotes.
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.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
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© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
For more information about us and how we conduct our business, you can read our privacy policy and terms of use.