Understanding what is covered by your car insurance policy can help you avoid unexpected costs in the future. But, how do you know if you have the right cover for your vehicle? Here are some important factors to consider, so you can make a confident decision.
Types of Insurance
Comprehensive Insurance offers the highest level of protection. However, there is a wide range of policies on the market, so careful consideration is required to get the policy that best suits you and your family.
Some key points to look for (besides the price) include:
- Choice of Repairer – We strongly recommend you retain this option so that you can select a repairer that has completed all the correct training and has all the equipment necessary to do the job right. In a Preferred Repairer Option, your insurer will make this decision on your behalf – your request or opinion may not be considered.
- Excess – Check the standard excess amount payable, especially at renewal. Make sure the amount of excess does not increase to keep the cost the same. Changes should be highlighted. It is also important to check the age excess for young drivers. Consider if you can accept a higher amount of excess if you have more than one accident a year.
- Kilometres – Pay-as-you-go insurance can be great however the costs are enormous if you go over the kilometres registered and then have an accident. So, it is best to check regularly and perhaps leave a reminder in the car or calendar to check your odometer every three months.
- Hire Car – Different options available upon request. Consider for a small cost upfront, compared to if your vehicle is not road worthy, and immediately off the road following an accident. In some locations, parts may be unavailable or the repairer unable to commence the job for weeks. Some policies have an unlimited hire car option which can be of great benefit if you do not have access to another vehicle, especially as parts shortages continue.
- Windscreen Inclusion – Newer model vehicles have lots of high-end technology to help keep you and your family safe. The costs of windscreens now range between $120 to upwards of $3,000 with additional costs for calibrating radar units, rain sensors, and codes. Once this option is removed from your policy, it is difficult to get back, so it is definitely worth including.
Compulsory Third Party (CTP) insurance is a legal requirement for all drivers in Queensland and is attached to the registration of your vehicle. CTP covers the cost of third-party compensation claims if you, or anyone driving your car, causes an accident in which someone else is injured. You are also covered if you are Not At Fault – partially covered if you are.
Third-Party Insurance offers cover for damage caused to someone else’s vehicle or property if you’re liable for it. It does not cover your vehicle, property, or medical costs.
Some facts that can affect the Premium cost include:
- Location or postcode
- Previous claims history
- Where the vehicle is stored (e.g. behind a fence, in a garage, street-side)
- Age (young drivers are considered higher risks, as with older drivers due to slower reaction times). It may be possible to include people in these higher-risk groups to another policy such as a parent or guardians.
Market Value versus Agreed Value
Market Value refers to the estimated price your car is worth on the open market at the time of making a claim. When assessing the market value, your insurer will consider a range of factors including the vehicle’s condition, age, make, model, and kilometres travelled. To get an idea of what your car may be worth, you can search for it in the Red Book or on car sales websites.
Agreed Value is a sum based on what you and your insurer agree to when you take out or renew a policy. An agreed value policy generally has higher premiums as the agreed value of the car is usually higher than what it would sell for on the open market (market value).
Current global conditions have seen considerable changes to this space with market value increasing due to limited supply. It is best to do your research on this prior to taking out the policy, and understand how much it would cost to replace what you currently have.
Custom Features
Customised colours and modifications including accessories for 4WDs generally need to be listed separately. Custom or prestige vehicles may require a policy that is geared towards enthusiasts or collectors.
Comparing Insurance Companies
Prices vary from company to company and from policy to policy. It is important to compare like for like – same excess, same options, same value.
For example, policy A may include windscreen option and hire car, while policy B may cost the same but have different inclusions. Post-accident, these options become extremely costly, so it is important to delve into the fine print before signing.
Written-off Vehicles
Written-off vehicles deemed repairable are difficult to reinsure and a lot of research is required before making the initial purchase to ensure it is possible to do so. Usually, the premium is considerably higher than a normal vehicle. Find out more about written-off vehicles HERE.
Looking for a repair shop? Deal with someone you can trust!
The Motor Trades Association of Queensland (MTA Queensland) is the peak body representing the interests of employers in the retail, service, and repair sectors of Queensland’s automotive industry. Look for members displaying the MTA Queensland logo to provide reassurance that you are dealing with someone you can trust.
Find an MTA Queensland member HERE.
10 March 2022
Please note the information contained on this page is general in nature and does not take into account your specific needs or circumstances. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice.