Luxury Car Insurance
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Are you the proud owner of a luxury car in Australia? Safeguarding your high-end vehicle is essential, considering the potential risks it faces on the road and the potential expense associated with getting it repaired. Whether it's a prestige sports car, exotic sedan or classic automobile, it’s important to take the time to look for the right insurance policy for your luxury vehicle and compare your options online.
What qualifies as a luxury car for insurance?
In Australia, the definition of a luxury vehicle for car insurance purposes can vary among providers. However, typically, luxury cars are considered high-end vehicles with specific features, advanced technology and a higher market value. Factors that can contribute to classifying a car as luxury include its price and market value, performance, design, modifications and exclusivity. Some examples of luxury car brands in Australia include Porsche, Jaguar, Lamborghini and Ferrari.
However, ultimately, what constitutes a luxury vehicle often comes down to the owner. Most insurers don’t have specific criteria they follow when it comes to separating luxury cars from other vehicles: they’re typically more interested in the market value of the vehicle than its classification as a ‘luxury’ car. However, it's still important to consult with insurance providers to determine whether they have specialised products for prestige vehicles like yours.
How does luxury car insurance work in Australia?
Luxury car insurance generally functions similarly to standard car insurance policies. In most cases, luxury vehicles can be insured under standard policies provided by various insurance providers. However, there are some specialist insurers who offer policies tailored to the unique needs of luxury or prestige vehicles. These specialised policies may offer additional coverage options and benefits which cater specifically to the requirements of luxury car owners.
Because of the different options available, it’s important to explore a range of insurance offers to help you find the most suitable coverage for your luxury car.
How much does luxury car insurance cost?
There are many factors which go into calculating the cost of your luxury car insurance policy. This includes the following:
- Make and model of the luxury car: the specific make and model of the luxury car will affect the insurance premium, as some models may be more expensive to repair or replace than others.
- Market or agreed value cover: owners of luxury vehicles and those with modifications commonly seek out agreed value cover rather than market value to lock in a higher payout in the event of theft or a write-off. However, because of this greater payout, you’ll likely pay more for agreed value than market value, which bases its payout on the value of your vehicle immediately before it was written off.
- Owner's driving history and claims record: a clean history without driving offences and a lower number of previous claims will likely result in lower insurance premiums, as it indicates a lower risk of accidents or incidents.
- Level of coverage and policy options chosen: the extent of coverage and additional policy options will also impact the premium. Comprehensive coverage (which is common for luxury and exotic cars) or additional features may result in higher premiums.
- Insurance provider and their pricing structure: each insurance provider has its own pricing structure, so premiums will vary depending on their underwriting guidelines and risk assessment.
- Age of the driver and their driving experience: younger and less experienced drivers generally face higher insurance premiums due to the higher perceived risk associated with their age group.
- Location where the luxury car is parked and driven: your location plays a role in insurance premiums, as areas with higher rates of accidents, theft or extreme weather may result in higher premiums. Additionally, where the vehicle is parked also makes a difference, with those parked in a garage generally deemed safer than cars parked on the road.
- Security features and anti-theft measures installed in the vehicle: vehicles equipped with advanced security systems or anti-theft devices may qualify for discounts on insurance premiums, as they reduce the risk of theft or damage.
- Frequency and purpose of use: the more frequently the car is driven, or if it’s used for business purposes, the higher the insurance premium may be due to increased exposure to potential risks.
- Additional coverage for modifications or accessories: if your luxury car has aftermarket modifications or expensive accessories, additional coverage for these items may increase the insurance premium to adequately protect their value.
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.
What can specialist luxury car insurance cover?
Modifications
Specialist luxury car insurance can cover the cost of repairs or replacements for certain aftermarket modifications, such as upgraded alloy wheels, body kits, suspension upgrades or performance brakes. However, not all modifications can be covered, such as turbocharged engines or roll bars.
Salvage rights
In the event of a total loss, your policy may provide coverage for salvage rights, allowing you to retain ownership of the vehicle. Luxury vehicle collectors may be attracted to this in order to take parts from their write-off and repurpose them for future purchases.
Import of vehicles or parts
Luxury car insurance can also include coverage for importing vehicles or obtaining replacement parts from overseas, protecting against risks and damages during transportation. However, these will typically be limited to a set dollar amount.
Multi-car discount
Some insurers offer a multi-car discount for luxury car owners with multiple vehicles insured under the same policy. Depending on the nature of the vehicles and whether there are any other drivers listed on your policy, this may provide cost savings and add convenience to your insurance.
Agreed value cover
Instead of basing its coverage on market value, which is common with standard policies, luxury car insurance generally offers agreed value cover, where the insured value is agreed upon between the policyholder and insurer, offering greater financial certainty in terms of the payout you can receive if it’s written off.
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