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Switching car insurance policies
Switching car insurance providers is usually straightforward. Before you do it, it can help to consider the following:
- Review your current policy: Make a note of your current premiums and the type of policy you have, so you’ll know a better deal when you see it.
- Get a clear idea of your needs: Has it been a while since you took a good look at your policy? To make sure you’re receiving value for your money, take stock of your needs:
- Determine the current market value of your car and ensure it aligns with your policy–most vehicles depreciate in value year-on-year.
- Estimate the number of kilometres you drive each year. If you’re not driving a whole lot you may be able to save with a ‘low-kilometre’ or ‘pay as you drive’ policy.
- Consider the risks you face–are you worried about bushfires or floods in your area? What about vandalism or theft?
- Use Canstar’s comparison tables: Quickly compare a wide range of comprehensive car insurance policies from our Online Partners by using our comparison tool. You can narrow down your options by filtering your search.
- See if your current provider will offer you a deal: Before switching, it can pay to contact your existing car insurance provider and let it know you’re thinking of leaving–it may offer you a deal to convince you to stay, and may even help you adjust your current cover to get costs down.
- Make the switch: If it’s time to change your provider, you can apply for coverage with your new one, either over the phone or online, following its normal application process.
- Cancel your old insurance: Once your new policy is up and running, inform your old provider that you wish to cancel. You may be eligible for a refund of a portion of any premiums you’ve already paid, depending on the policy’s terms and conditions.
Why compare car insurance?
If your car was written off in a road accident or weather event, would you be able to cover the cost of replacing it? The answer will depend on your financial situation, but regardless, your vehicle is likely one of your most valuable possessions. Not only that, but if you have a car loan, then comprehensive car insurance is probably a requirement.
There are a number of reasons why it’s worth comparing:
- To find out if you could save on insurance premiums without compromising on the important cover you need
- To find a policy that matches your needs and lifestyle, especially regarding cover for events like floods, fire, and theft
- To avoid the ‘set and forget’ trap of sitting back and allowing your premiums to go up each renewal, rather than comparing to see if there are suitable options for a cheaper price
- To know if you can save money by bundling the different insurances you already have
What is the best car insurance in Australia?
There’s no one ‘best’ car insurance provider, as the best one for you will be the one with a policy that meets your needs and budget. If you’re comparing car insurance, Canstar’s Car Insurance Awards recognise the providers that offer outstanding value to customers around Australia. Meanwhile, our annual Most Satisfied Customers Award: Car Insurance & Roadside Assistance recognises the providers with the most satisfied customers.
Our most recent national award winners were:
- 2026 Car Insurance Outstanding Value Award - National: AAMI, Bingle, and ROLLiN’ Insurance
- 2026 Most Satisfied Customers - Car Insurance Award: Bupa
How does car insurance work?
Across Australia, all registered vehicles must be covered by Compulsory Third Party (CTP) insurance. The process for this varies between states and territories; some states incorporate CTP into your car’s registration costs, while others require you to buy the insurance separately.
While additional insurance is not mandatory, it's highly recommended to ensure your own car is covered for accidents, theft or other incidents. Australian drivers can compare dozens of insurers offering several types of optional car insurance.
Policies require you to pay a premium for coverage, which can be paid annually or monthly. If you’re involved in an accident or incident covered by your insurance, you can make a claim with your provider directly. If your claim is approved, your insurance provider will then pay for car repair or replacement, and any associated costs covered by your policy.
What are the different types of car insurance available in Australia?
There are two main types of optional car insurance in Australia, being comprehensive and third party.
What is comprehensive car insurance?
Comprehensive car insurance is the highest form of coverage available and covers drivers for a wide range of risks, whether it’s the cost to repair damage you’ve caused to someone else’s vehicle in an accident, or damage or loss of your own vehicle due to extreme weather or in an accident, regardless of who was at fault.
In addition, a comprehensive policy may cover you for other costs associated with an accident or other insured event. For example, it may cover the cost of a rental car to drive while your vehicle is being repaired or replaced, roadside assistance if your car is involved in an accident or breaks down, or windscreen repair and replacement. Some providers may let you purchase these covers as optional extras to add on to your policy.
What is third party car insurance?
Third party car insurance broadly refers to a group of insurances that cover your liability if you’re involved in an accident and someone else is injured (CTP insurance) or their car or property is damaged (third party property damage and third party fire and theft).
Third party property damage insurance
Third party property damage insurance covers the cost of repairing damage caused by your vehicle to other people’s property, such as their car, trailer, or home. It generally also covers your legal costs if they sue you over the damage. It may also provide coverage for your vehicle (usually up to a limit) if your car is damaged in an accident caused by an uninsured driver. It does not cover damage to your own car in other circumstances, however. Third party property damage insurance is usually the cheapest form of optional car insurance.
Third party fire and theft insurance
Third party fire and theft insurance covers you in the same situations as third party property damage, while also providing cover for your vehicle if it’s damaged or lost because of fire or theft.
What is Compulsory Third Party (CTP) insurance?
Compulsory Third Party (CTP) insurance is a mandatory insurance that all drivers need in order to use Australian roads and is generally included alongside your vehicle's registration. It’s also referred to as Green Slip insurance in NSW and Motor Accident Injuries (MAI) insurance in the ACT. It covers costs associated with injury or death caused by a motor vehicle accident. The specific conditions of this type of cover, including how and when it’s purchased and which insurance providers offer it, differ between states and territories.
Insider tip: You could save with ‘pay as you drive’
A 'pay as you drive' policy lets you pay based on how far you actually drive. By nominating an estimated maximum kilometre limit upfront, your insurer may offer you a lower premium. Keep in mind, though, that not every insurer offers this type of cover, and it isn't right for everyone - if you make a claim and your odometer reading exceeds the distance you nominated, it could affect your payout.
Here are some of the key things to know about pay as you drive policies:
- They usually come with a base premium, which you then add to by buying a set number of kilometres for the year.
- This kilometre limit is typically more flexible than low-kilometre policies, letting you top it up or buy more kilometres when required.
- A higher or additional excess usually applies if you exceed the limit, and in some cases, your provider may reject claims for incidents that occur once the limit is passed (if you don’t top it up).
- Providers may require odometer readings when a policy comes into effect and at renewal.
Low-kilometre policies typically function slightly differently to pay as you drive policies, with notable differences including:
- Low-kilometre policies generally offer a fixed premium with a discount if you drive less than a set annual limit (like under 10,000 km).
- If you exceed this limit, you may have to pay an additional or higher excess when making a claim.
- If you notice you’re exceeding the kilometre limit during the year and inform your provider, they may transition you to a standard, higher-priced policy so any additional excess does not apply.
How much does car insurance cost?
According to the most recent figures from Canstar Research, the average annual cost of comprehensive car insurance around Australia is:
State or | Average |
|---|---|
New South | $2,792 |
Northern | $2,577 |
Queensland | $2,169 |
South | $2,145 |
Tasmania | $2,014 |
Victoria | $3,293 |
Western | $2,208 |
National | $2,460 |
Source: Canstar - 28/05/2026. Based on comprehensive car insurance policies rated in Canstar's 2026 Car Insurance Awards. Premiums include quotes for both new and used cars for a range of scenarios, with a state-specific target excess ranging from $800 to $1,000.
How much have prices increased over the last 12 months?
Average car insurance costs rose by $111 (5%) in 2026 compared with the previous year’s national average.
How much could you save by comparing?
The average comprehensive car insurance policy in Australia costs around $2,460 annually, while the average 5-Star Rated policy from our database costs $1,809. This means you could potentially save around $651 on average by comparing and switching. Here’s how much you could save on average in certain states and territories:
State | 5-Star Rated | Market | Potential |
|---|---|---|---|
New South | $1,991 | $2,792 | $801 |
Northern | $1,797 | $2,577 | $780 |
Queensland | $1,750 | $2,169 | $419 |
South | $1,573 | $2,145 | $572 |
Tasmania | $1,505 | $2,014 | $509 |
Victoria | $2,458 | $3,293 | $835 |
Western | $1,675 | $2,208 | $533 |
Source: Canstar - 28/05/2026. Based on comprehensive car insurance policies rated in Canstar's 2026 Car Insurance Star Ratings. Premiums include quotes for both new and used cars for a range of scenarios, with a state-specific target excess ranging from $800 to $1,000.
Why is car insurance more expensive for younger drivers?
The cost of your premiums is based on your perceived risk—the riskier you may be as a driver, the more likely an insurer will have to pay out a claim, and therefore, the more expensive the premiums. For this reason, younger, less experienced drivers are typically more expensive to insure than older, more experienced ones. The reverse is also true, in that older drivers with a demonstrated safe driving record can find their premiums are lower than those of others.
Data from Canstar Research shows average annual premiums for drivers aged under 25 are $3,158 for men and $2,833 for women–far higher than the average for over-50s: $1,451.
Insider tip: Exclude younger drivers if they don’t drive your car
If you’re over 30 and never let younger drivers near your steering wheel, you may be able to save. Some policies allow you to exclude or restrict drivers under 25 (or in some cases 30) from your coverage. Doing so can lower your premium.
Just remember: if you lend your car to a relative or friend younger than the cut-off and they cause damage, you may face an 'unlisted young driver' excess, or the claim could even be denied entirely.
How to compare car insurance
Insurers are required to provide you with documents like the Product Disclosure Statement (PDS), outlining everything that’s covered in a policy. While a PDS mightn't follow a standardised format like a Key Fact Sheet, they can still be useful for comparing policies. Nonetheless, with the sheer amount of information you’ll need to absorb, comparing policies can be overwhelming, so here are some key considerations:
The extent of the coverage
When comparing quotes for car insurance, it’s important to understand exactly what’s covered. Your vehicle will be insured for either its market value (what it might cost to replace your vehicle) or for an agreed value (an amount your insurer agreed to cover your vehicle for). This will be the maximum payout you’ll receive if your car is damaged or written off by an insured event, so make sure it suits your needs and you won’t be left with a shortfall should you need to claim.
Insured events and sub-limits
Make sure a policy actually covers you for what you need, particularly regarding damage caused by storms, hail, and flooding. Similarly, some policies will have sub-limits – maximum amounts that can be paid out in certain categories. Check to make sure you know what these are and how they apply so you’re not caught out.
Excess vs premiums
When purchasing insurance, it pays to consider the trade-off between a higher excess and lower premiums. Opting for a higher excess can spare you from financial pain in the short term, but can mean you need to pay more upfront if you need to make a claim. When comparing, look for a policy with an excess you’re comfortable with, coupled with premiums that are affordable for you.
Optional extras and add-ons
Car insurance policies typically offer a range of optional extras. Depending on the provider, this can include roadside assistance, or cover for a hire car in the event of an accident, rental car excesses, and excess-free windscreen repair or replacement. Check and see if your provider offers these and if you need them, or likewise, whether you’d rather not include them in your cover.
Claim limits, conditions, and exclusion periods
Review any policy exclusions, applicable exclusion periods, and benefit limits—particularly with regard to the duration and daily cost allowance for a hire car while your vehicle is undergoing extensive repairs or being processed as a total loss.
The claims experience
Considering whether to sign up with a car insurer? It can be worth researching its reputation. Look for reviews and feedback about the quality of its customer service and complaint resolution and the ease of the claims experience.
Discounts and bundling options
You may be able to snag a discount if your chosen provider offers a sign-up bonus, or if you can bundle up multiple vehicles on the same policy or your car and home insurance with a multi-policy discount. A number of providers will also offer a discount when you purchase a policy online. Just be aware that, while upfront discounts are appealing, the right policy will suit your longer-term needs and budget.
Insider tip: Save money by paying annually instead of monthly
Most insurers give you the option to pay your premium monthly or annually. Paying annually is almost always cheaper, as providers generally prefer to receive the full premium upfront to guard against additional costs and risks that come from monthly payments. If cash flow is a concern, monthly payments can make sense, but it's worth calculating the difference upfront so you know exactly what convenience is costing you.
What does car insurance cover?
Car insurance can cover the cost to repair damage caused or costs incurred by car accidents or other insured events. The events you’re covered for will depend on the level of cover you choose. For example, third party insurance generally only covers costs related to damage you cause to someone else’s property, whereas comprehensive car insurance provides protection against the cost of repairing or replacing your car too.
Does car insurance cover natural disasters?
Comprehensive car insurance in Australia generally provides protection against losses or damage caused by the likes of fires, storms, floods, and earthquakes. That’s not usually the case for third party policies.
When it comes to cover for natural disasters, insurers tend to be strict about what they do and do not cover and the circumstances in which they will pay out. They may reduce or even deny your claim if they find out that your vehicle has not been sufficiently maintained or if you didn’t take care to avoid the damage (like if you left your windows open during a storm, ruining your car’s interior).
Insider tip: Beware the 72-hour exclusion period trap
When a severe weather warning hits the news—like an incoming cyclone, large storm cell, or bushfire threat—people may naturally rush to buy or upgrade their car insurance. Many Australian insurers, however, enforce strict 72-hour exclusion periods for damage caused by a natural disaster on new policies. For example, if you buy a policy on Thursday because a massive hailstorm is forecast for Friday and your car gets dented, your insurer potentially won't pay out. You’re best to lock in your policy well before the clouds roll in.
How does flood cover work with car insurance?
As an Aussie motorist, it can be especially important for your peace of mind to know that you’re covered for flood damage, but this area of car insurance can be a bit more complex.
Does all car insurance come with flood cover?
Flood cover is generally only found in comprehensive policies. Some providers may limit the amount you can claim for flood damage, so make sure you read product documentation for any policy carefully.
What is a ‘flood’ and are you covered?
The standard definition of a flood in insurance terms is “the covering of normally dry land by water that has escaped or been released from the normal confines”, says the Insurance Council of Australia (ICA). Check how your insurer defines a flood to make sure you’re covered. It’s also important to note that most providers do not offer cover for rising seawater or tidal flooding.
What about storms and cyclones?
Comprehensive car insurance will generally cover damage caused by strong winds, lightning strikes, hail, earth movement, fallen trees, and rainwater.
How do exclusion periods work for flood cover?
In Australia, many insurers will typically impose a 72-hour exclusion period for flood cover on your policy, before your coverage kicks in and you can claim for damage.
How does bushfire cover work with car insurance?
Bushfire season is a critical time to make sure your car insurance is up to date, and while comprehensive car insurance has cover for bushfires, there are important precautions to take. Check your policy for 'duty of care' requirements, as you may be expected to take basic precautions—like closing all windows and moving the vehicle to a low-risk area—provided it does not compromise your safety.
Likewise, it’s important to understand what’s excluded from your cover. Policies that cover bushfire damage may not cover damage caused by heat and soot. Third party fire and theft policies can provide some coverage for bushfires, but claim limits may apply. It’s crucial to read the fine print, to make sure your policy covers everything you need.
How much car insurance cover do you need?
When choosing a policy, it’s important to make sure the value your insurer attaches to your vehicle provides enough cover for your needs. The market or agreed value is the amount your insurer will pay if your vehicle is written off or stolen. But what does this actually mean?
- The market value is an estimate of what your current vehicle could cost on the open market.
- An agreed value is an amount you and your insurer agree to cover your vehicle for. This may be beneficial if your vehicle has expensive, non-standard accessories or you want more of a say over what your vehicle is worth.
If you have a new or expensive vehicle, comprehensive car insurance is a crucial consideration. It can cover you for a range of risks, including accidental damage caused by a car accident regardless of who was at fault.
On the other hand, if your vehicle is not worth a whole lot and you could feasibly buy a new one out of your own pocket, you may opt for a third party policy to protect you from paying to repair damage you may cause to other people’s property.
How do you avoid underinsurance?
Underinsurance means you don’t have sufficient coverage to repair or replace your car, after an event like a road accident, flood, or fire. It’s concerningly common in home insurance, but may also occur in car insurance. To avoid this, you can:
- Make sure your policy is up to date, reflecting any new accessories that may add to your car’s value
- Make sure your market or agreed value reflects the actual cost of replacing your car
- Check if your policy has adequate cover for fires, storms, flooding, theft, and any other insured events that are a priority for you
- Consider single-item insurance for any especially valuable accessories like roof racks or awnings
- If you have an outstanding loan on the vehicle, it’s important to note the vehicle’s current market or agreed value. If it’s considerably lower than what you still owe on the loan, you may be left with debt even after a total loss payout.
Some providers may offer protection against underinsurance in the form of ‘new for old car insurance’, sometimes known as new car replacement. This is an optional feature that can be added to some comprehensive policies, that replaces your written-off or stolen vehicle with a brand-new model of the same or a similar kind. It can provide peace of mind for new car owners (typically those with cars under two to three years old) that they’ll be protected against depreciation.
What’s not covered by car insurance?
Your car insurance policy will not cover you in certain circumstances, commonly referred to as ‘exclusions’. Some common car insurance exclusions are
This can include driving under the influence of alcohol or drugs or without a valid driver’s licence, leaving your car unlocked or valuables within it, failing to contact police in the event of a car theft or vandalism, or using your car for work without your insurer's consent like driving for rideshare or food delivery services.
Your insurance might not pay out for costs related to engine failure and general wear and tear, faulty repairs (unless the repairs were conducted by the insurer’s authorised repairer), if your car is unregistered or doesn’t meet the requirements of registration when something happens, or for losses caused by pre-existing conditions of your car such as mechanical defects or recalls.
Your insurance might not provide coverage for liability for bodily injury or death, as this is covered by Compulsory Third Party (CTP) insurance, if your car is legally seized and damaged while impounded, financial losses related to your car being damaged (like lost wages), damage by vermin, or events like war or terrorism.
Does car insurance cover you for regular servicing and maintenance?
Car insurance does not cover you for the everyday running costs of your car like service and maintenance. If your car is in need of a tune-up or repairs, you’ll need to organise this yourself.
How are car insurance premiums calculated?
When calculating your premiums, an insurer will generally assess the level of risk you represent as a driver and the value of your vehicle, for a start. There are a number of key factors that go into determining how much you pay, such as:
- Your age, gender, and experience as a driver
- The make, model, and age of your car and whether it has any non-standard features, accessories, or modifications
- Where your car is kept during the day and at night, including where it’s parked and its proximity to natural disaster risks and crime
- How often and far you drive the car and if you drive during peak hours
- Your claims and driving history
- The excess you choose
- The optional features you add to the policy
Why do car insurance premiums increase?
Premiums tend to increase because of inflation and rising business costs. For example, the cost of labour and parts increases each year, which means that repairing damage to a car costs more.
Likewise, the rising prevalence of severe weather events means insurers are paying out an increasing size and number of claims, which puts prices up across the board. Increasing the agreed value of your car, reducing your excess or making a claim can also cause your car insurance premiums to rise.
What is car insurance excess?
Your standard excess is the amount of money you agree to contribute towards any car insurance claim you make. An excess can be paid up front or taken out of a claim's payout, and the amount is determined when you take out your policy. The higher the excess you choose, the lower your premiums will be, but the more you’ll have to pay out in the event that you make a claim.
Your excess amount can vary. Say you opt for an $800 excess and you need to make a claim that’s worth $4,000, you would pay the first $800 upfront and your insurer would pay the remaining $3,200.
Your policy may also come with several different additional excesses:
- Age excess: May apply to claims involving a driver of a certain age (typically 21 or 25 years of age).
- Unlisted driver excess: Applies to claims involving a driver not listed on your policy.
- Inexperienced driver excess: Applies to claims involving a driver on a certain type of licence, such as a learner's permit or provisional licence.
- Driver history excess: Applies to claims involving a driver who’s had their licence cancelled, suspended, disqualified, or restricted in the three years prior to the start of your policy.
- Special excess: Your insurer may add special excesses to your policy in particular circumstances, such as the performance of your vehicle being increased due to modifications or adding a driver to your policy with a particular driving, insurance, or criminal history.
- Glass and windscreen excess: Depending on your policy, you may have a reduced or excess-free option for glass and windscreen repair. This feature will usually come at an additional premium.
Insider tip: Save on your premium by opting for a higher excess
Opting for a higher standard excess means paying more out-of-pocket when you make a claim, but your insurer will typically offer a lower premium as you’re taking on financial risk. It's worth considering if you believe you’re a safe or infrequent driver who is unlikely to claim - just make sure you could still comfortably cover the excess if you need to.
How do you renew your car insurance?
Car insurance is often a 'set and forget' expense. Once you have a policy set up, your provider will send a renewal notice each year, usually at least 14 days before your policy expires, noting any changes in costs. If you have your premiums set up to direct debit from your account, then your provider will continue debiting them as before.
As a consumer, it’s important to be wary of this–if your car insurance auto-renews each year, your provider could be hiking your premiums and taking you for a ride without you realising. Equally concerning, though, if you don’t review your insurance each year, you could end up being over or underinsured.
For this reason, when renewal time comes around, it can pay to review your coverage, both in terms of the cost and of how much you’re covered for, to make sure you’re still getting what you need. If you’re not, then it could be worth seeing if there’s a better deal out there for you.
How do you find cheap car insurance?
When it comes to car insurance, the cheapest option may not be the best for you. Car insurance exists to cover you from financial loss in the event that your car is damaged or written off. A cheaper policy that excludes coverage for accidental damage, for example, may be lighter on the wallet month-to-month, but could cost you in the long run if you find out you’re not covered for what you thought you were. If you feel you’re paying too much for car insurance, there are ways to save without compromising on important cover.
11 tips to save on car insurance
Canstar Research found that you could potentially save around $651 by switching to a 5-Star Rated policy. It can also pay to give yourself plenty of time to compare these quotes.
A number of providers offer discounts to customers who purchase a policy online rather than over the phone or in person.
A higher excess will generally mean lower premiums, although you’ll have to pay more upfront if you make a claim.
While underinsurance is less common in car insurance, overinsurance may be a factor. Review your policy to make sure your vehicle is accurately valued and you’re not paying for things you don’t actually need.
If you’re in a position to pay your premium as an annual lump sum, you could save, as some providers may charge you more if you pay month-to-month.
Paying out of pocket for small repairs can help maintain your no-claim bonus or safe driver discount and stop your premiums from going up as a result, until such time as you need to make a larger claim.
Having younger or inexperienced drivers listed on your policy may add to its price, but in some cases you may be offered the option to restrict them. Some providers may also offer ‘Named Driver’ discounts for listing the nominated drivers of your vehicle on your policy. Be aware that with this discount, in the event that you need to make a claim for an unnamed driver, your excess will often be much higher.
Some providers will offer you a discount on your premium if you drive less than a certain distance per year, usually with a low-kilometre or pay as you drive policy. Your premiums may also be lower if you don’t drive during peak hour traffic.
Is your car parked in a locked garage or secure parking spot? Then your premiums will typically be lower, as your vehicle appears less likely to be damaged, broken into, or stolen. You may also get a discount if your car has security features such as an immobiliser, alarm, or satellite tracking, but this will vary between insurers and not all of them offer such discounts.
Some providers offer a ‘multi-policy’ discount if you take out two separate types of policies with the one provider, like car insurance and home insurance. However, it’s important to weigh up whether you would get better value or coverage by splitting your policies across different providers. The same can be said for long-term loyalty discounts, which may not outweigh the savings another provider’s policy could present to you.
Providers sometimes offer discounts for new members. If you’d rather stay with your current provider, there’s nothing stopping you from asking if it might extend a similar perk to you to reward your loyalty as a customer.
When should you get car insurance?
If you’re buying a new or used car, it’s suggested that you have an active policy as soon as you take possession of the vehicle. Many banks and lenders will make comprehensive car insurance a condition of your car loan before you purchase the vehicle, meaning you can’t get your funds unless you have it.
Do I need car insurance?
Car insurance is important for your own peace of mind, but also crucially to cover the costs you’ll face should the unexpected occur.
Say, for example, that your vehicle was damaged or written off in an at-fault traffic accident, and you didn’t have insurance. You would be responsible for paying the full cost of repairing or replacing your car, costs associated with damage to other involved parties’ vehicles and property, and continuing your regular repayments to your lender—if your car was purchased with a loan.
This situation would be financially untenable for many of us and illustrates why it can be vital to have some form of optional car insurance.
Is comprehensive car insurance worth it?
To work out whether comprehensive car insurance is worth the premiums you would pay, consider asking yourself the following questions:
- How much is your car worth today?
Most cars depreciate over time. In some cases, you may find that your car’s value means it’s not worth paying the generally higher premiums for a comprehensive car insurance policy. - Could you afford to replace your car if something happened?
If your car is essential for your lifestyle and/or your job, you may find that a comprehensive car insurance policy is worth the extra cost. - Are you still making repayments on your car loan?
Some banks and financiers require that your vehicle holds a comprehensive car insurance policy as part of the loan’s terms and conditions.
How do car insurance claims work?
It’s generally possible to make a claim over the phone or via your insurer's online portal. It’s usually best to tell your insurer of any damage immediately and to provide as many details as possible.
Collect evidence
If it was a road accident involving another driver, take down their details, registration number, and insurance details. Also note details such as the location and time of day of the accident, a description of what happened, a police report number (if you have one), details of any tow truck company that may have attended, and contact details of anyone who may have witnessed the accident.
You’ll generally be required to provide proof of the damage, so take photos and videos as soon as possible. It’s also worth taking photos of your vehicle when you initially take out your policy in order to make it easier to prove damage down the track.
If the belongings kept inside your car are important to you, it pays to keep an inventory or checklist, especially of items that you would want to replace as a priority in the event of loss or damage (like dashcams, radios, and reversing cameras). Some insurance companies have mobile apps that let you upload photos directly from your smartphone and update your claim straight away.
You may also need to provide evidence of ownership and value of any particular items that you’re making a claim on. This could include receipts, valuations, credit card statements, and photos.
Claims process
Once you’ve submitted the claim, your insurer will have 10 business days to respond to it, per the rules set out in the General Insurance Code of Practice. There are then two general possibilities:
- If no further investigation or information is required, your insurer must decide to accept or deny your claim within this 10 business day period.
- If further information or investigation is required, then your insurer must notify you of what information it needs, and whether it will appoint a loss assessor or adjuster to investigate your claim. It must also provide an estimate of the time frame required to make its decision. Keep in mind that four months is the mandatory maximum deadline to reach a decision on standard claims.
If your claim is in the process of being assessed and you request an update, your insurer is required to respond to your request within 10 business days. Your insurer is also required to update you on the status of your claim every 20 business days until a decision is made.
How do car insurers settle claims?
If your vehicle is written off or significantly damaged by an insured event and you successfully make a claim, your insurer may send out an assessor to gather evidence and determine the scope of works needed, as well as the preferred method of settling the claim. There are three main ways in which they might do this:
- Pay to have your vehicle repaired at its preferred repair shop.
- Offer you a cash settlement to conduct repairs yourself or, in the case of a total loss, pay out the market or agreed value listed on your policy.
- Provide you with a brand new replacement vehicle, if this feature is included in your policy.
Be cautious around cash settlements. If you accept one, repairs to your car will be your responsibility and the amount may not be sufficient to cover the repairs needed, states the Australian Financial Complaints Authority (AFCA). AFCA stresses that cash settlement offers must be “fair in the circumstances” and sufficient for a policyholder to arrange repairs. You aren’t obligated to accept a cash settlement if your insurer offers you one.
Insider tip: Skip the claim for small repairs
Paying for minor repairs out of pocket, rather than going through your insurer, can leave you better off. It means you avoid paying an excess, protect any no-claim bonus you might have, and could help keep your premium down at renewal. This can be a smart move for small cosmetic damage as, if the repair costs less than your excess and the value of your no-claim bonus, it may be cheaper to pay out of pocket.
What if your claim is denied?
If your car insurance claim is denied or you’re unsatisfied with the outcome, it’s important to understand exactly why your insurer has denied it.
Common reasons to be denied might be that your policy excludes the event or damage you’re claiming for, that you failed to report the claim within the timeframe outlined by your policy, or that you provided false or inaccurate information when making the claim.
If you feel your claim has been unfairly denied, you can contact your insurer and ask for it to be resolved by their internal dispute resolution process. If you’re unhappy with the outcome of this, you can escalate your claim to AFCA. If you’re still unsatisfied with the outcome, you may consider obtaining legal advice from a solicitor.
How do I make a car insurance claim when it’s not my fault?
If you have comprehensive car insurance, you can typically make a claim to cover the costs of the accident. You’ll need to provide your insurer with information about the accident, including the details of the other driver (or drivers) involved; as well as information about any witnesses to the accident, tow-truck company used and the police report filed.
Your insurer will then contact the at-fault driver’s insurer or the driver themselves (if they don’t have insurance). Your insurer may also arrange a hire car for you if you need one, depending on the coverage of your policy.
What can void your car insurance?
Australian policyholders have a duty to take reasonable care not to make a misrepresentation when it comes to their car insurance. It's also your responsibility to update your details when things change. This means your policy can be voided if you intentionally lie or omit facts about your driving and claims history, personal details, or the condition of your vehicle. For example, if you state that your car is kept in a locked garage overnight when it's actually out on the street, or fail to disclose a criminal record that would make you uninsurable, this could void your policy.
When a policy is voided, the insurer usually treats it like it was never in effect, meaning legitimate claims could be disregarded.
What happens if you have a car accident without insurance?
The person who's responsible for a car accident is typically the one required to pick up the bill. If you're at fault in an accident and have no insurance other than CTP, then it's likely you'll have to pay for any damages out of pocket.
The kinds of costs you may have to pay to the other driver could include the cost of repairing their vehicle, towing fees, the cost of a rental car while their vehicle is being replaced, and the costs of replacing any damaged personal property.
What if you believe another party was at fault for the accident?
If you don't have optional car insurance and are involved in an accident for which you believe another party was responsible, Legal Aid Queensland says you can make a claim against them for damage to your vehicle or property. If you're in this situation, it may be worth pursuing legal advice to find out if you have a claim against the other driver.
If you're not insured but have been in an accident with a driver who was, and you believe they caused damage to your vehicle or property, you can also make a complaint to AFCA. You'll be able to do this if:
- You can prove that the other driver was at fault for the damages
- The damage is less than $19,000
- The other driver has made a claim on their insurance.
