10 tips to save money on your car insurance
If you’re looking for ways to cut down costs and boost your savings, you might want to take a look at your car insurance.
If you’re looking for ways to cut down costs and boost your savings, you might want to take a look at your car insurance.
Some Australians pay thousands of dollars each year for comprehensive car insurance. If you’re on a reduced income, working from home or driving less than usual, this may seem particularly expensive. Here are 10 simple tips that could help you save on your car insurance.
10 ways to save on car insurance
- Buy online
- Choose a higher excess
- Pay annually instead of monthly
- Shop around
- Keep your car secure
- Drive safely
- Drive less
- Consider bundling your policy with other products
- Insure your car for its market value
- Choose your extras carefully
1. Buy online
Many car insurers in Australia offer discounts if you buy your insurance online rather than in person, as it generally costs them less to sell their policies this way. Some insurers offer a fixed dollar discount (such as $100 off), while others offer a percentage discount (such as 10% off your first year’s premium).
→ Read more: Online discounts and sign-up offers for car insurance
2. Choose a higher excess
Your excess is the amount of money you pay if you need to make a claim. The higher it is, the lower your premiums will generally be. Some insurers will let you change your standard excess level to make it higher or lower, while others will let you add a voluntary excess on top of your standard excess. This could further reduce your premiums in exchange for higher out-of-pocket costs when it comes time to make a claim. Increasing your excess won’t be for everyone though, and you should weigh up whether you want to pay a higher excess amount if you do need to make a claim.
3. Pay annually instead of monthly
Some insurers charge lower premiums if you pay your insurance annually, rather than in monthly instalments. While this might not be the most straightforward option for those of us who budget month to month, it could be worth doing if you can pay the one-off payment. Alternatively, you might want to consider going with a provider who lets you pay monthly at no extra cost. According to the Canstar’s Research Team, 41% of the insurers in Canstar’s 2023 Car Insurance Star Ratings currently have this option.
4. Shop around
It’s a good idea to compare your car insurance options and see if you could get a better deal. Canstar compares dozens of comprehensive car insurance policies based on both price and features. This can help ensure you get a competitively-priced policy, while ensuring you have cover that suits your needs.
Compare Car Insurance with Canstar
If you’re comparing car insurance policies, the comparison table below displays some of the policies currently available on Canstar’s database for a 30-39 year old male seeking comprehensive cover in NSW without cover for an extra driver under 25. Please note the table is sorted by Star Rating (highest to lowest) followed by provider name (alphabetical) and features links direct to the providers’ websites. Consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD), before making a purchase decision. Contact the product issuer directly for a copy of the PDS and TMD. Use Canstar’s car insurance comparison selector to view a wider range of policies. Canstar may earn a fee for referrals.
Products displayed above that are not “Sponsored or Promoted” are sorted by Canstar’s Star Rating and then alphabetically by company. Canstar may receive a fee for referral of leads from these products. See How We Get Paid for further information. If you decide to apply for car insurance, you will deal directly with an insurance provider, and not with Canstar.
Consider the provider’s detailed product and pricing information before making a decision to purchase a policy. The products displayed on this page do not include all providers and may not compare all features relevant to you. View the Canstar Car Insurance Star Ratings Methodology and Report. The rating shown is only one factor to take into account when considering products.
5. Keep your car secure
If your car is parked in a garage rather than out on the street, your premiums will typically be lower because insurers may see you as less likely to make a claim. You may also get a discount if your car has security features such as an immobiliser, an alarm and/or satellite tracking.
6. Drive safely
While it’s good to be a safe driver regardless, some insurers will reward you with a discount for doing so. A number of insurers on Canstar’s database offer a ‘no claims bonus’ or ‘no claims discount’. This typically gives you a discount if you don’t claim on your insurance and the discount will increase each year you don’t claim (up to a limit).
7. Drive less
You could also save by driving your car less. If you drive less than a certain distance per year (usually 10,000 kilometres), some insurers will offer you a discount on your premium. Another option could be to choose a ‘pay as you drive’ policy. These policies cover you up to a certain distance and are generally cheaper than regular policies for people who don’t drive often.
8. Consider bundling your policy with other products
Some insurers also offer a ‘multi-policy’ discount. This is a discount when you take out two separate types of policies with the one insurer. For example, car insurance with home insurance. However, before taking the plunge, it’s important to consider whether you would get better value and/or coverage by splitting up your policies across different insurers.
You can compare a range of insurance products with Canstar, such as home, health and life insurance. Canstar compares and rates policies based on both cost and features.
9. Insure your car for its market value
You can generally insure your car for either its ‘market value’ or ‘agreed value’. The ‘market value’ is how much your car would be worth on the open market at the time of a car insurance claim. It takes into account factors such as the car’s make, model, condition and mileage, so it can change over time. This is compared to the ‘agreed value’, which is a set value that has been agreed on by you and your insurer. It will generally be cheaper to insure your car for its ‘market value’, although it may not provide as much certainty as to how much your car is insured for.
10. Choose your extras carefully
Your premiums will also be more expensive if you add optional extras to your policy, such as windscreen cover, roadside assistance and rental car cover. Consider whether having extras is worthwhile for you. For example, you might want to look at how much it would cost you to buy the add-on coverage separately rather than as part of your policy.
As well as the above tips, it’s also worth asking your insurer directly whether they can offer you any additional discounts to help you save.
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Canstar may earn a fee for referrals from its website tables, and from Sponsorship or Promotion of certain products. Fees payable by product providers for referrals and Sponsorship or Promotion may vary between providers, website position, and revenue model. Sponsorship or Promotion fees may be higher than referral fees. Sponsored or Promotion products are clearly disclosed as such on website pages. They may appear in a number of areas of the website such as in comparison tables, on hub pages and in articles. Sponsored or Promotion products may be displayed in a fixed position in a table, regardless of the product’s rating, price or other attributes. The table position of a Sponsored or Promoted product does not indicate any ranking or rating by Canstar. For more information please see How We Get Paid.
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This article was reviewed by our Content Lead, Canstar Mandy Beaumont before it was updated, as part of our fact-checking process.
- 10 ways to save on car insurance
- 1. Buy online
- 2. Choose a higher excess
- 3. Pay annually instead of monthly
- 4. Shop around
- 5. Keep your car secure
- 6. Drive safely
- 7. Drive less
- 8. Consider bundling your policy with other products
- 9. Insure your car for its market value
- 10. Choose your extras carefully
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