Main types of Auto Insurance

August 5, 2019

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Compulsory third party (CTP) insurance – Also called a’green slip’, this covers injury and death to people if you’re involved in an incident. Each state and territory has different rules about this kind of cover, so check your state or territory traffic/transport authority to learn more.

Third party property insurance – Covers the repair costs of property damage your vehicle causes. Some policies also have an ‘uninsured driver extension’ that covers you if you’re in an accident caused by another driver, and they aren’t insured.

Third party property, theft and fire – Covers damage to other people’s property and gives limited cover for damage to your car due to theft or fire.

Comprehensive auto insurance – Covers damage to your car and other people’s property if your car is in an accident (like fire) as well as theft.  Before picking a company, we recommend looking at best car insurance in Australia 2019 with iSelect.


Other kinds of auto insurance

  • Add-on insurance – Offered by automobile dealers and might include gap insurance, consumer credit insurance, or breakdown insurance. A number of this insurance isn’t really good value and you might already have some of the cover. Discover more about the insurance extras offered by auto dealers.
  • Usage-based insurance – Insurers monitor your driving habits using technologies installed in your vehicle. They’ll monitor things such as your speed, distance travelled and how hard you brake and accelerate. They may also think of where your vehicle is driven and where it’s usually parked.
  • Pay as you drive (PAYD) insurance – The premium is based on the amount of kilometres you expect to drive in the upcoming year. If, during the year, you believe that will drive further than intended, you can ‘top up’ your kilometres for an extra price. But if you exceed your chosen kilometres and do not inform the insurance company, your level of cover could be reduced.