Car insurance in Australia is designed to protect you financially if you are involved in an accident on the road. Choosing the policy that’s right for you could depend in part on what you can comfortably afford, so it may be worth considering the type of cover that suits your needs and your budget. For example, would you prefer the high level cover generally offered by a comprehensive policy, or would a lower level of cover be enough?
If you decide that comprehensive cover is right for you, you can start your search by comparing policies with Canstar or viewing our latest Car Insurance Star Ratings Report before getting a quote online.
There are four main types of car insurance in Australia. These are:
Canstar’s Star Ratings are one factor you could use to help you compare comprehensive car insurance policies before getting a quote. Our ratings process uses a sophisticated and unique methodology that compares both price and features across products on our database.
Canstar’s Star Ratings represent a shortlist of comprehensive car insurance policies, enabling consumers to narrow their search to products that have been assessed and ranked. The results depend on which state or territory in Australia you are in and vary based on the age of the driver too. The Ratings are reflected in a consumer-friendly one to five-star system, with a 5-Star Rating representing outstanding value to the consumer.
Some of the features Canstar compares and considers in its Star Ratings are:
You can read the full Star Ratings report or compare policies yourself, based on your own requirements, using the comparison selector tool at the top of the page before proceeding to get a quote.
When you’re shopping around for cover, you may simply want to get the cheapest car insurance policy you can find. It can be important to also keep in mind the level of protection you’re getting for your money. For example, with optional forms of cover, third party property may be the cheapest car insurance in some situations, but it won’t cover you if your car is damaged in an accident or stolen.
Even if you decide on a higher level of cover, like comprehensive, there may be ways to keep the cost down. Some insurers offer discounts if you pay your premium annually or take out the policy online as opposed to over the phone, or you could opt to pay a higher excess if you need to make a claim. It can also help to shop around and compare quotes from a number of insurers. These techniques may help you get value for your money, while still getting a higher level of cover than the cheapest car insurance might offer.
As Canstar’s Editor-in-Chief, Nina heads up a team of talented SEO experts and journalists committed to helping empower consumers to take greater control of their finances. Previously Nina founded her own agency where she provided content and communications support to clients around Australia for eight years. She also spent four years as the PR Manager for American Express Australia, and has worked at a Brisbane communications agency where she supported dozens of clients, including Sunsuper and Suncorp.
Nina has ghostwritten dozens of opinion pieces for publications including The Australian and has been interviewed on finance topics by the Herald Sun and the Sydney Morning Herald. When she’s not dreaming up ways to put a fresh spin on finance, she’s taking her own advice by trying to pay her house off as quickly as possible and raising two money-savvy kids.
Nina has a Bachelor of Journalism and a Bachelor of Arts with a double major in English Literature from the University of Queensland. She’s also an experienced presenter, and has hosted numerous events and YouTube series.
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You can also read more about Canstar’s editorial team and our robust fact-checking process.
Please note that these are a general explanation of the meaning of terms used in relation to this topic. Your provider may use different wording and you should read the terms and conditions of your policy carefully to understand what you are and are not covered for. Refer to the product disclosure statement (PDS) from your provider. You may wish to obtain advice from a suitably qualified adviser.
What is ‘agreed value’ cover?
In car insurance, agreed value cover is where the amount a vehicle is insured for is fixed by agreement between the insurer and the policyholder. The other main option is to insure your vehicle for its market value (see ‘market value’ below).
What is ‘comprehensive car insurance’?
Comprehensive cover is the highest level of policy coverage in Australia, which covers you for other people’s cars and property in an accident, damage to your own vehicle caused by fire or theft, and accidental damage to your own vehicle, regardless of who caused the damage. It may also provide additional types of cover, depending on the insurer and policy you choose.
However, comprehensive car insurance does not cover you for injury or death caused to other people in an accident – that’s where compulsory third party (CTP) insurance comes in.
What is ‘compulsory third party (CTP) insurance’?
CTP is a compulsory policy that covers you if you injure or kill someone in a motor vehicle accident. The specific conditions on this type of cover are different from state to state, but no matter where in Australia you are, it is compulsory to hold CTP in order to register your vehicle.
What is an ‘excess’?
An excess is an amount of money you pay your insurer towards the cost of your claim. Different excesses might apply to different types of claim, so you should check your policy for details. You may be able to pay a lower premium if you have a higher excess, but you need to be sure that you could afford to pay the excess unexpectedly in an emergency.
What are ‘exclusions’?
An exclusion is anything that is not covered by your policy. Exclusions may vary between providers, so it is a wise idea to read policy documents carefully when obtaining any quotes.
What are ‘inclusions’?
Inclusions are anything that is covered by your policy. When a particular event is listed as being included in your policy, the insurer will cover the whole expense (minus your excess) or a listed percentage of the cost involved.
What is ‘market value’?
Market value is what your vehicle would be worth on the market, or what it would cost to replace your vehicle with one of the same make, model, age, and condition that your vehicle was in before the loss or damage. This is one option for your sum insured; the other option is to insure your vehicle for an agreed amount (see ‘agreed value’ above).
What is a ‘no-claim bonus’?
A no-claim bonus is a discount on premiums that some insurers may offer drivers who haven’t made any claims so far on their policy. Some providers may have a ‘protected no-claim bonus option’, where they will let you keep your no-claim bonus after you make your first claim in any one period of cover, under certain conditions.
What is a ‘nominated driver’?
When you sign up for a policy, you must advise the insurer who will be listed on your policy as being allowed to drive your vehicle (usually yourself and one or more family members). These people are the nominated drivers. Other people who drive your car but are not nominated drivers would be required to pay an additional excess if they were in an accident while driving your vehicle and you needed to make a claim as a result.
What is a ‘premium’?
A car insurance premium is a regular amount of money you pay for the cover your policy provides. Depending on your insurer, it may be paid once annually or more frequently (e.g. monthly or fortnightly). Your premium must be paid on time for your car to remain covered.
What is a ‘third party property’ policy?
This is a policy that covers the cost to repair damage caused by your vehicle to other people’s property, such as their car. It will also cover your legal costs if they sue you over that damage. It does not cover damage to your own car, however.
What is a ‘third party, fire and theft’ policy?
This is a policy that covers damage to the property of others, and some limited cover for your own vehicle if it is damaged or lost because of fire or theft. It generally does not cover damage to your own car caused by a car accident.
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Star Ratings and Award Results
Canstar enables consumers to compare providers and narrow their search for policies before seeking car insurance quotes. As premiums are based on your personal circumstances and the insurer’s policies, you can generally obtain a more accurate car insurance quote by visiting the provider’s website.
With dozens of providers offering a range of products, it is often a good idea to have a clear understanding of the cover you require before you seek car insurance quotes. This can help you save time by narrowing your search and ensuring you only receive quotes for products that may be more suited to your needs. Keep in mind that there are a number of factors to consider when selecting a policy, and that the one that quotes the cheapest premium may not necessarily offer the best value for your circumstances. Aside from the quoted premium, you may also want to consider factors such as what is included (and not included) in the cover, how much the excess is and the quality of customer service on offer.
The quote you receive for the cost of your premium will be based on a number of factors, including your age, your gender, the model of your vehicle, the type of policy you choose (such as comprehensive, third party or third party fire and theft) and where the vehicle will be parked during the day and at night. The provider will typically ask for this information when you are requesting a car insurance quote. You can also request a quote for optional features such as windscreen cover, roadside assistance and rental vehicle availability during repairs. Some providers offer sign-up bonuses or discounts on premiums for people who fulfill particular criteria, such as applying for the policy online, so when obtaining quotes from providers, it could be worth checking if you’re eligible for any deals.
Canstar’s Comprehensive Car Insurance Star Ratings take into consideration costs as well as features to determine the overall value of each product we rate. Products found to offer outstanding value receive a 5-Star Rating. This can help consumers narrow their search to comprehensive products that have been assessed and determined to offer value, prior to seeking a quote.
Below are some popular car insurance providers we rate or view more here before getting a quote online:
