Buying a car
Common car insurance myths debunked
22 August 2022
There’s a lot of false statements about car insurance floating about.
To make sure that fact overcomes fiction, it’s time those myths get debunked. That way, the next time you make a claim with us, everyone can be on the same page.
Since there’s a lot of different insurers out there, we’ll focus on Suncorp when we need to get specific.
Car registration in Australia always includes basic insurance
This isn’t quite true.
It is true that CTP (Compulsory Third Party) and MAI (Motor Accident Injuries) Insurance is required by law in Australia for you to be able to drive. But, it’s arranged differently depending on your state or territory.
Some states include the cost of CTP or MAI, which covers your liability for damages caused by the death or injury of another driver or person– but not the cars or property involved – in your registration fees.
Others require you to purchase CTP or MAI separately, before you’re able to register your car.
All states and territories differ in their approach, so check with your relevant government authority.
Anyone driving my car is covered
If you need to make a claim for damage to a vehicle or property, and the at-fault person driving your car at the time of the incident is not listed on your policy, or cannot provide the at-fault party’s details, there may be an additional excess. Your claim may even be refused, or the payout reduced if an unlisted driver was the one at fault.
Learner drivers don’t need to be listed on your policy, but as soon as they get their Ps they need to be added, if they’re going to continue driving your car. While they’re on their Ls, a standard excess and other applicable excesses apply if the learner is driving at the time of an incident.
It’s also worth remembering that many insurers won’t cover a driver under 25 when driving a high-performance vehicle.
Requirements differ between insurers, so be sure to check with your provider to see what’s relevant to your specific policy. Check the relevant PDS for more information.
If I’m uninsured but not at fault, I don’t have to pay
If either you or the other party don’t have insurance, you should disclose this at the scene of the incident. Not doing so can slow down the claims process and cause unnecessary problems for drivers and insurers alike.
If you don’t have insurance and aren’t at fault, you may still end up having to pay for your damagedepending on the other driver’s cover, and if you noted their insurance information.
If the at-fault driver doesn’t have insurance either, you may to cover the costs of getting your car fixed yourself, as well as any associated legal costs when it comes to trying to recover this from an uninsured driver. So, it may be a good idea to make sure you’re properly insured!
Car insurance doesn’t cover modifications or accessories
While car insurance won’t pay the costs of actually getting any modifications or accessories on your vehicle, insurers like Suncorp will generally cover these additions as long as they’re informed and your policy is updated.
Talk to your insurer when you plan on making any alterations to your car, as they can affect its value to the point that your sum insured – the maximum amount you can be paid if and when you make a claim – may not be sufficient to repair or replace it.
Personal belongings stolen or damaged aren’t covered by car insurance
Here’s another myth, because if you’re a customer with Suncorp Comprehensive Car Insurance, some eligible belongings may be covered for loss or damage if they were in your car at the time of an insured event. The amount per item varies, so check the PDS for details. This can cover things like:
- an attached trailer
- tools of a trade, and
- baby capsules or child seats.
If you want your personal items to be covered when you’re anywhere in Australia and New Zealand, not just when they’re in your car, Suncorp Contents Insurance offers optional cover for personal valuables. This includes up to $1,000 per item for unspecified item coverage, or you can specify approved items like cameras, laptops or tablets for their values exceeding $1,000.
Keep in mind that with personal valuables, if you need to make a claim, you’ll have to provide invoices and receipts so that your insurer can verify the item’s value.
Car insurance covers mechanical repairs and breakdowns
Another common misconception is that breakdowns and mechanical repairs are included in car insurance, but this isn’t always the case. In the same way general wear and tear isn’t covered, neither are mechanical repairs or breakdowns.
However, if you and your car are ever stuck on the side on the road, Suncorp Roadside Assist can be added to any of our three offered levels of Comprehensive Car Insurance. That way, you can get out of trouble when you need help.
Keep in mind that there is no cover for Suncorp Roadside Assist during the first 24 hours of adding the cover, so be sure to plan ahead. For full coverage details, please see the Terms & Conditions.
How often I drive my car doesn’t affect my premium
This can depend on your insurer. Some providers give more flexible insurance coverage than you’d find in the past, in part because commuting and work habits have changed immensely.
When you receive a quote for car insurance with Suncorp, the amount of time you spend driving your car is considered alongside how you use your car. This can affect premiums.
Red car insurance costs more than cars of other colours
Here’s a classic: the red car insurance myth. The myth claims that red cars are more expensive and are more prone to theft, and therefore will cost more to insure.
The truth is that insurers are more interested in the make, model and age of your vehicle than its fancy coat of paint. Remember, they’re factoring in how safe your vehicle is, and what it would cost to repair or replace it. So, unless your paint is made from liquid gold, it really shouldn’t factor into those costs.
Parking your car in a garage means you get a cheaper premium
While this may seem like it’s the case, there’s just so many factors that impact the costs of premiums that may cause this to not be entirely true. It can depend on your insurer, as they may want to know how much time your car will be parked and how often you drive it.
Whenever your circumstances may change, be it by moving to or from a residence with a carport or garage, be sure to let your insurance provider know.
Having car insurance means you aren’t out of pocket for anything
The main purpose of car insurance is to provide cover for you if you’re involved in a car accident, so you won’t need to pay the upfront costs of repairs if you’re the one at fault. This doesn’t mean there won’t be costs you have to pay. If you lodge a claim, regardless of where fault lies, you may have to pay an excess.
This excess depends on things like the circumstances of the accident and how your policy is set up. For example, you may have elected to pay an extra amount on your premiums to reduce your excess.
If my friend is driving, they’re financially responsible for the accident
To be absolutely clear, both morally and according to the great mates’ code, no friend should try to dodge their way out of paying for damages they may have caused if they’re in an accident. But as the person listed on the policy as the policyholder, you’ll be the one who’s financially responsible to pay the excess.
Insurance is issued by AAI Limited ABN 48 005 297 807 trading as Suncorp Insurance. Read the Product Disclosure Statement before buying this insurance. The Target Market Determination is also available. This advice has been prepared without taking into account your particular objectives, financial situations or needs, so you should consider whether it's appropriate for you before acting on it.
Suncorp Roadside Assist is an optional extra only available in conjunction with Suncorp Comprehensive Car Insurance. Suncorp Roadside Assist is provided by Digicall Assist Pty Ltd. For full coverage details, please see the Terms and Conditions .
The information is intended to be of general nature only. Subject to any rights you may have under any law, we do not accept any legal responsibility for any loss or damage, including loss of business or profits or any other indirect loss, incurred as a result of reliance upon the information. Please make your own enquiries.