In Australia you usually have four options for insuring your vehicle. Among them there are: compulsory third-party insurance, comprehensive insurance, fire&theft only and third party property only.
Compulsory third-party insurance must be owned by every driver. Not having this insurance leads to detentions and is illegal. Such insurance provides cover in case of injuring other persons while driving your car. However, regulations on this insurance may vary from state to state, so it’s always better to check beforehand.
Comprehensive insurance covers costs for cases such as accidents, theft, and different kinds of damage. You can also use it for compensating costs, if you have caused damage to someone elses’s property while driving. As a rule, this type of car insurance is chosen by owners of new or almost new cars. In case of older vehicles it is often unprofitable, as insurance payments exceed compensation in case of an accident or damage.
Obviously, fire&theft insurance is aimed at covering expenses, caused by fire and theft. This is a specifically limited insurance and you cannot count on it if you are involved in the accident.
Third party property insurance covers costs, which were caused by your car to the third party’s property or vehicles. However, it does not compensate expenses for your own vehicle. This type of insurance is the opposite of comprehensive insurance – it is reasonable to use it for older models of cars. In this case the damage caused to the third party’s property often exceeds the cost of the car itself.
Some insurance also includes Uninsured Motorist Extension (UME). It is applied in cases when your car was damaged by an uninsured vehicle, provided that you have that driver’s personal data (name and address) at your disposal and you were not the cause of the accident. The amount of coverage usually accounts for $3,000 to $5,000.
You should also remember about an excess payment you will have to pay when making a claim. Some insurance policies also include excess payment for certain age of the driver. The size and terms of such payment are described in your contract with insurance company.
Car Insurance in Australia for visitors practice the system of discounts for people who weren’t making claims for some periods of time. They are considered to belong to the low risk category. So, the premiums may be decreased. The size of discount varies and depends upon each specific insurance policy.
When insuring the car it is important to clarify which value is insured. There are two types of value: agreed and market. Agreed value means the value that was negotiated by the driver and insurer. Market value is the value which is defined by the insurance company. It depends on various factors (age, mileage, previous driving history, etc.).
It’s also useful to find out whether you are able to repair the car wherever you want, or whether the company determines it itself. Enquire whether the amount of premiums can be reduced, because some companies accept such option. Also, determine precisely in which cases your no claim bonus is cancelled.
The amount of insurance premiums varies from company to company. There is no single algorhythm of calculating them, as each company takes different factors into account. Among these factors usually are the value of the car and its age, the driver’s age, type of use (private, job, commercial use, etc.), driving and claims history, etc.
You should always tell your insurer about such things as car accessories; all fines and detentions, otherwise you won’t receive your compensation. You must always inform about all changes concerning your vehicle. And, finally, carefully read the insurance policy – Policy Document and Product Disclosure Statement.
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