Car Insurance for First Timers

Car Insurance for First Timers

Car Insurance for First Timers
Buying your first car is exciting, but at the same time, car insurance can be tricky. You’re probably thrilled about the prospect of owning your own car, but a bit confused or dubious about all the different options available to you. If you are buying a car in Australia, these tips will help you get your insurance sorted.

Car Insurance for First Timers

What are the different types of car insurance?

Car insurance is generally split into three categories. Some providers can split insurance out into more sub-categories, depending on what they offer, but most will offer at least these three:

1. Compulsory Third Party Insurance – Also known as ‘Green Slip’ cover, Compulsory Third Party Insurance is (as the name suggests) compulsory across Australia and must be paid when registering your car. This insurance protects you against injury (or death) to another person while you are driving (if the crash is your fault). If the person makes an injury claim, your cover will protect you from having to pay. It doesn’t, however, cover the cost of repairs to your car or another person’s car.

2. Property Damage or Theft Insurance – This insurance covers you against damage to another person’s car, where the accident or incident is your fault. Initially, it won’t cover costs to repair your own car, but you can usually upgrade this level of insurance to cover your own car as well against losses caused by damages in an accident, fire or if it is stolen. It’s always a good idea to get property insurance for your car, because you won’t know how much an accident or other unfortunate incident might cost you.

3. Comprehensive Insurance – Comprehensive Insurance is the most expensive, but offers you the highest level of cover (and the most peace of mind). It essentially covers both your car and another person’s car in the event of an accident, fire, or if it is stolen, regardless of whose fault the accident or incident is.

How much do I have to pay?

There is no, one, fixed price for car insurance premiums and so how much you have to pay depends on your car and what type of car insurance quotes you can find. Car insurance is also calculated based on a number of factors about you and your driving experience and will differ slightly based on what state you live in. These factors can include things such as:

• Your age

• You gender

• Your driving record, including any previous accidents, warnings or fines

• Make and model of your car, including its age and any modifications

• How costly it is to repair your car

• How long you’ve had your licence for

• If anyone else will be driving your car and what age they are

• If your car is kept in a garage or on the street

• Your ability to pay your premiums on time

What if I’m under 25?

Generally speaking, if you are under the age of 25 (or 21) you will have to pay a slightly higher insurance premium, since you haven’t been driving for as long as other drivers and you are at more risk of an accident. This doesn’t mean that you still can’t find a cheap level of insurance cover and you may find that some providers will offer you discounts as a younger driver. To get the best out of your car insurance you will still need to shop around and make sure you keep a good driving record.

What Else Should I Be Asking Myself?

If you’re still unsure about what kind of insurance you need, you can chat to more experienced drivers (like your parents) as well as professionals who work at a provider. However, you may want to ask yourself the following questions:

• How experienced a driver am I?

• Who is going to pay for damages to another car if I’m in an accident and I’m at fault?

• Who is going to pay for damages to my car if I’m in an accident and I’m at fault?

• I can afford to pay for damages to another car like mine, but what if I crash into a luxury car that is expensive to repair?

• How dependent am I on my car? If my car is damaged or stolen will I still be able to get to work?

Still Got Questions?

At the end of the day, it’s always better to over-estimate rather than under-estimate your insurance needs. It’s still up to you what type of insurance you choose and which provider you want to go with, so a healthy balance between the best level of cover for the most competitive deal is the way to go.

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