Comprehensive policies provide a few weeks’ worth of car hire should you compose off your vehicle in an accident where you are to blame.
Nobody wants to be captured underinsured, but if you are paying more than 10% of the car’s value every year in premiums you might want to consider a cheaper policy. To find the cheapest insurance policy try comparing a range of car insurance quotes with iSelect.
Third party property is a fantastic alternative — nobody wants to be stuck paying for somebody else’s fix bill.
Third-party property with theft and fire cover your vehicle for a few calamities, allowing you put aside some money in a self-insurance savings accounts. By self-insuring, you do not need to manage an insurer when something goes wrong, but you do have to resist the temptation to dip into the fund.
Agreed value and market value: what is the difference?
For motorists with comprehensive or fire and theft policies, the amount your insurance company will pay if you write off your car is dependent upon your agreed value or market value.
This is when you cover your vehicle for a particular amount (within a range specified by the insurer).
If your car is a complete loss (i.e. written off or stolen), the insurance company will pay you this amount, less the excess.
If your vehicle is under financing, consider insuring it for an agreed value that is at least equal to the amount remaining on the loan. That way, for those who have a whole loss you’ll have the ability to square off the debt before looking for a new vehicle.
This is when you cover your vehicle for what its worth is in the time of an incident.
Insurance tips, traps and discounts
Know your Surplus
An excess is the amount you pay to submit a claim. The greater your surplus, the lower your premium.
Increasing your excess can help save you money but be careful of a really higher surplus — it will not be worth your while to create a smaller claim.
Every insurer has a name for this: no claims discount (NCD), safe driver incentive, the list continues. Essentially it is a discount for not making a claim. A’maximum’ score (which generally means no promises for five years) can save you up to 70%.
Some insurers provide a lesser NCD, but will also offer you a reduction on their roadside assistance merchandise.
You can often pay extra to protect your NCD, meaning if you have an accident, it will not affect your rating. But in case you’ve got a protected no claim bonus, do not assume an’at fault’ claim will not have an influence on your premium. Some insurers increase your premium no matter. A’no fault’ claim like hail damage can affect your premium.