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How Much Car Insurance Do I Need?
- Oxcel Finance
- December 28, 2023
Are you someone who just bought a brand-new car and wants new car insurance? Then the first question you must ask yourself is, how much car insurance do I need?
You do not want to pay for an insurance policy that does not provide all the coverage you might need. At the same time, you want to spend your insurance wisely, as you may already have a car loan to pay off.
How Much Car Insurance Do I Need
With all of that in mind, we have come to you with comprehensive car insurance and the average cost of it in Australia. So, without any further ado, let us dive right in.
How Much Car Insurance Is Required?
How much you need and how much is required by law are two very different things that you must understand. The car insurance you require is usually decided by the government and is far less than what you might need in real life.
To be able to drive on the road, you need compulsory third-party insurance, otherwise known as the green slip or CTP. This is a must-have insurance you must acquire if you want to give your card in any state of Australia.
The good news is that once you register your vehicle, it is usually automatically included with the registration. That being said, if you are in New South Wales, you must have an insurance policy before you can even register the vehicle.
As CTP is mandatory in every state in Australia, we are often unsure what the policy is. So let us briefly examine the CTP coverage to understand what you are missing out on.
A Dive into the CTP Coverage
The purpose of compulsory third-party insurance is to provide financial assistance to individuals who are hurt or die in accidents when their car is at fault.
This effectively implies that the third-party mandatory insurance Green Slip shields you against financial responsibility in any litigation or settlement claims that may develop if you are involved in an accident that results in injuries. This also works for anyone who is driving your car.
What does compulsory third-party insurance not cover?
Your compulsory third-party insurance policy offers no coverage for damage to your car, any other vehicle, or any structure, no matter the state where the accident may occur.
Without supplementary auto insurance, you're still responsible for any resulting financial losses, so it's crucial to continuously evaluate your insurance requirements before you get behind the steering wheel.
Other Insurance Options that You May Need
Now that you know what CTP covers, let us look at how much car insurance you may need besides the mandatory green slip.
To start things off, the first insurance we recommend is Third-Party Fire and Theft Insurance. This insurance covers many damages, including,
Theft - Coverage for your vehicle if it is stolen and damaged up to a specific amount during a theft attempt.
Fire - Coverage for fire-related car damage.
Damage to others' property - Coverage for accidents if you cause damage to other people's property or vehicles.
Accidents by drivers - When another driver causes a car collision, have your automobile covered for damage.
Hire cars after a theft - If your automobile is stolen or cannot be driven when somebody attempts to break in, some Insurance can provide you with a rental car.
Towing - If your automobile cannot be driven because of a fire, alleged theft, or catastrophe that wasn't your fault, coverage for transporting it to any repair shop or secure location is provided.
Third-party property insurance
If you are at fault, CTP does not offer coverage for the other person's property. However, to be safe, you can opt for third-party insurance assistance to have coverage for fixing other parties' automobiles if you are responsible for the accident.
This insurance is strongly recommended for young drivers who might need to be financially strong enough to cover other parties' damage if required.
Comprehensive car insurance
On the other hand, comprehensive car insurance is much more costly but can offer you protection and coverage for damage to other people's cars and your own. This is provided regardless of the person who is at fault.
Final thoughts
That ends today's article on how much car insurance I need in Australia. A few things to remember: CTP green slip is a mandatory policy you must have before your car hits the road.
As for other car insurance, fully understand what your policy covers and opt for the one that fits your needs. Stay tuned for more updates.
