In states like South Australia, this insurance is typically attached to the total cost of a brand-new car. However, in other states like New South Wales, this insurance isn’t part of the total purchase price, meaning you’ll have to pay more for a bundled package deal to secure one yourself.
If you’re considering buying a car, it’s imperative to familiarise yourself with the laws surrounding insurance before pushing through with the purchase. This is to ensure legal compliance and added assurance knowing you have the necessary cash flow and budget to make such a purchase.
Regardless of how you obtain your car insurance policy, having car insurance is mandatory for all vehicles driven on Australian roads, whether they’re ICE or electric.
Having said that, just like with buying cars, the price of car insurance may differ based on the buyer’s profile and car type. The price can also differ based on the type of coverage you’re planning to get, and having more coverage typically translates to higher costs.
Want more insights on the pricing structure and how you can claim insurance? This article will go into detail about the nature of a comprehensive car insurance, the historic price range to expect, and what you can claim if you’ve encountered any accident.
What is Comprehensive Car Insurance?
Comprehensive car insurance is a type of automobile insurance that covers damages to your car and to other people’s vehicles and properties during non-collision events. It’s a type of financial protection that pays you up to the total value of your car if it gets damaged.
Comprehensive car insurance is an optional insurance policy that safeguards drivers from non-collision-based risks that they may experience on the road. This offers peace of mind knowing that any vehicular damage will be covered for most types of damages beyond your control.
This type of car insurance policy is often required on top of the mandatory collision insurance—which is a type of insurance that covers damages caused by a collision. The type of damage sustained includes single-car rollovers, vehicular collisions, or collisions with a property.
Comprehensive car insurance does not cover medical bills sustained during accidents. It can be claimed no matter who’s at fault, granted that you’re eligible for it.
What’s the Average Cost of Car Insurance?
Car insurance prices aren’t often a package deal; they’re typically fine-tuned to fit the profile of their buyer.
For instance, men tend to pay more on annual monthly car insurance costs than women. Besides that, your driving record and claims history also influence the final premium price.
The price is also heavily influenced by external factors like the state where the car is sold and the car type.
Here’s a breakdown of the average monthly car insurance cost per age group in Australia, categorised by age group.
|
Age Group |
Average national annual car insurance cost |
|
18-24-year-old Male |
$2,437 |
| 18-24-year-old Female |
$2,184 |
|
25-29 years old |
$1,733 |
|
30-49 years old |
$1,312 |
|
50 years old + |
$1,006 |
|
Families with a young driver |
$2,180 |
Furthermore, some territories have higher annual premiums than others. New South Wales, Victoria, and Northern Territory are on the higher end, whereas Queensland, Tasmania, Western Australia and South Australia are on the lower end.
As laid out above, the average monthly insurance cost tends to be most expensive for younger individuals aged 18 to 24 years old.
Furthermore, EV owners don’t only have to worry about higher average upfront payments for acquiring the vehicle—they also have to pay more for insurance.
Electric vehicles cost more to insure than internal combustion engine (ICE) cars by an average of $661 per year.
Just like traditional cars, EV insurance policies tend to vary depending on customer profile and location. That said, some companies like ROLLiN’ are starting to introduce a one-price scheme to simplify the process of buying comprehensive car insurance for electric vehicles.
What is a Comprehensive Insurance Deductible?
A comprehensive deductible refers to the amount you have agreed to pay out-of-pocket if you successfully filed a claim under a comprehensive car insurance policy. This deductible is not available for owners of liability insurance policies, only comprehensive policies
Car insurance buyers have the option to choose how much they’re willing to pay under minimum and maximum terms. For instance, they can agree to pay as low as $100 or as high as $2,000 out of pocket in case they do need to use comprehensive car insurance.
Choosing a lower deductible may seem like the best option, but this will cause your monthly insurance premiums to cost more. Conversely, if you agree to pay out $2,000 before the insurance policy kicks in, then you can enjoy cheaper insurance monthly premiums.
The choice of whether to get a high or low insurance deductible depends on an individual’s risk tolerance and financial profile.
If they feel that the risk of being a victim of theft is low, then they can go for a higher deductible. Conversely, if they want to pay out a low amount, then they can opt for a lower deductible.
As a practical illustration, if you choose a $500 deductible and your car sustains damages amounting to $2,000 and is covered with a comprehensive insurance policy, you will pay $500 out-of-pocket and the insurance company pays the rest of the bill—$1,500.
Suppose you have chosen a deductible amounting to $1,000. In that case, your monthly premiums are smaller than the one in the initial example (considering every other factor remains the same). Still, the insurance company will only pay for $1,000 while you pay the rest.
Deductibles are personal choices that hinge on one’s own risk tolerance and financial health, but this flexibility allows you to choose the best fit given your habits and circumstances.
What is Covered Under Comprehensive Car Insurance?
It’s important to talk with your car insurance provider to accurately know what they provide in their comprehensive car insurance policies.
That said, general car insurance providers cover damage or losses for the following in their comprehensive car insurance policies:
- Accidental collision
- Lightning or hail
- Fire or explosion
- Storm, flood or water
- Theft or attempted theft
- Vandalism
If your car sustains damage caused by any of these factors, you can claim financial aid for the repair costs under this car insurance policy.
For electric vehicle owners, comprehensive car insurance policies can also cover incidents causing damage to EV-specific parts like batteries, charging cables, wall boxes, and adaptors.
How to Apply For Comprehensive Car Insurance
When buying a car, you may be requested to get an additional comprehensive car insurance policy. While they’re not compulsory unlike CTP insurance, they can help you out in a financial pinch.
Here’s the best way to go about applying for this type of policy:
- Assess your needs: Determine whether having this car insurance policy is viable considering your financial situation and driving habits.
- Look for various providers: Find a provider for the car insurance policy.
- Apply for the insurance: Share some personal information and answer a few questions about you and the other drivers of the car.
- Gather and compare quotes: After the applications, look at the monthly fee and coverage offered by the car insurance providers you’ve applied for.
- Choose a quote: Select the best quote from your chosen providers, discuss your deductible, and secure a contract.
Be sure to make the monthly payments as written in the contract. If the time comes that you need to claim, then just go through the claiming process as indicated in the contract or discussed with the agent. Alternatively, you can give them a call for further details.
