Is it worth taking out car insurance?

In Australia, it’s illegal to drive a car without CTP insurance , and doing so can result in significant penalties, including fines, licence suspension and vehicle seizure. The other levels of insurance – TPPD, TPFT and comprehensive – are optional, but provide additional cover and can help safeguard you against the associated costs of the repair or replacement of your vehicle and other people’s property (provided the event qualifies for coverage). The type of cover that suits depends on your circumstances, so it's important to assess your requirements and budget to determine the appropriate level of insurance.

Can I get a lower premium if I pay my car insurance annually instead of monthly?

Some insurance providers will charge less for policyholders who opt for annual rather than monthly payments. By paying the full premium upfront, you may be able to save on administrative fees and instalment charges associated with monthly payments. However, it’s important to check with your insurance provider to understand the specific discounts and benefits available for annual payments.

Why does my car insurance premium change each year?

Car insurance premiums may increase each time your policy’s up for renewal, even if your driving habits are the same and you’ve not made any claims. Reasons for this include: Changes in circumstances, such as moving house More risks on the road Inflation An increase in the insurer’s business costs, which are passed to the customer Insurers are required to notify policyholders about any premium adjustments, but if you aren’t happy with the rate you're offered, you can compare and switch policies.

Does my driving record affect my car insurance cost?

Your driving record can significantly impact your car insurance cost. When you take out a policy, insurance providers assess your driving history, including any traffic offences or accidents, and adjust premiums accordingly to reflect the level of risk you pose as a driver. A clean driving record with few or no incidents indicates a lower risk, often leading to lower premiums. On the other hand, a history of accidents or traffic violations suggests a higher risk, resulting in higher insurance costs.

Will my insurance premium increase if I make a claim?

A driver’s claim history is a crucial factor affecting insurance costs. If a driver has a history of making multiple claims, insurers may consider them higher risk and, subsequently, increase their premiums. Maintaining a clean claim history can lead to lower insurance costs in the form of a no-claim bonus .

Can I lower my premium if I complete a defensive driving course?

Your insurer may offer a discount if you’ve completed a defensive driving course. These programs are designed to enhance your driving skills and teach you techniques to anticipate and respond to potential hazards on the road. Voluntarily completing a recognised defensive driving course helps demonstrate to insurers that you're committed to improving your driving abilities and reducing the risk of accidents, which can lead to you being offered reduced premiums.

How can I reduce my car insurance costs as a new driver?

Young and inexperienced drivers generally face higher car insurance premiums as insurers perceive them as higher risk. However, there are ways to reduce costs, such as: Using your parents’ car Buying a cheap car Taking a defensive driving course Driving less

Can I get a discount if I have multiple vehicles insured under the same policy?

Many insurance providers in Australia offer a discount if you have multiple vehicles insured under the same policy. Keep in mind that eligibility criteria, such as all cars being registered to the same address or owned by the same person, may apply, so it’s important to check with your insurance provider.