Table of Contents
No matter the product or service, we all want to get the best bang for buck when we make a purchase, especially considering the financial stress many households are now facing. While choosing car insurance may not feel like an exciting shopping expedition, it’s an essential for many Australians, and the value equation is no different.
The price you pay for insurance coverage is referred to as a ‘premium’, and it’s tailored to each driver based on a complex set of personal and demographic factors. We’re going to explore them all here, including how you can lower your premiums and haggle for a better deal.
Frequently Asked Questions (FAQs)
How much does car insurance cost in Australia?
This is the big question on every cautious motorist’s mind, but it’s very difficult to answer outright. Because insurance premiums are set based on each driver’s risk profile, it’s nearly impossible to suggest an accurate average insurance premium in Australia. As an overarching rule, you can expect third party premiums to be lower, and comprehensive options to be considerably higher.
What is a good premium for car insurance?
The best premium for any one driver is a price that fits in their budget on a policy that covers all their needs as a car owner and driver.
There’s no point purchasing a very cheap insurance policy if your car is quite valuable and an essential transport method in your life. While you may save on premiums, you’ll find yourself in a tricky spot if your insurance doesn’t cover repairs or replacement and you need a car to get to work or support your family. Conversely, if you have extensive cover that goes beyond what your car is worth or how you use it, then you’re throwing money away.
Does car insurance increase after making a claim?
It’s not a certainty, but it is likely that your car insurance premium will increase at renewal time if you make a claim in the previous year. It won’t happen until you do reach the end of your policy period, since your insurance company has effectively taken on the risk that you make a claim in that time. If they consider that the event and claim has increased your risk profile as a driver and insurance customer, then they will generally increase your premium.
You aren’t obligated to stay with the same insurance provider each year, so be sure to consider other options if your insurance gets bumped up because of a claim. Just don’t forget about any discounts or bonuses you may lose when switching providers.
Will a cheap car insurance policy be enough?
As long as you’ve factored in your needs as a driver, a more affordable policy isn’t necessarily less effective than an expensive option. If you’re only concerned with covering potential damages you may cause to other people’s vehicles and property while driving, a cheaper third party policy is adequate.
If you do choose the generally more expensive comprehensive option, prices will vary considerably depending on you and your car. There’s not point insuring your vehicle beyond what it’s worth, so a cheaper option within this level of insurance may still be the best fit.