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My car

7 car insurance myths busted

08 October 2021 


Not knowing the truth about common car insurance myths can make it hard to find the right cover for your needs. It can also cost you money and muddy the waters when it comes to making a claim.  

1. Myth: Car registration in Australia always includes basic insurance 

Not quite. It’s true that, by law in Australia, you must have Compulsory Third Party (CTP) or Motor Accident Injuries (MAI) insurance in order to drive a car.

Some states and territories include the cost of CTP or MAI, which covers you for damage to another person or driver (not your car or other cars/property), in your registration fees.

Some states and territories, however, require you to purchase CTP or MAI prior to registering your car.

CTP/MAI can help to cover costs related to injuries sustained in car accidents. For example, if you accidentally injure a cyclist, CTP/MAI can help with things like medical bills and payments for lost income for the injured person. It doesn’t, however, cover any vehicle or property damage.

Not all states/territories will cover the at-fault driver. In Queensland, for example, if there is no at-fault vehicle, an injured person may not be eligible for compensation under the Motor Accident Insurance Commission.

2. Myth: Anyone driving my car is covered 

There’s often confusion about this, which can cause headaches when making a claim. It’s easiest to list it out: 

  • If anyone driving your car at the time of an incident isn’t listed on your policy, this may result in additional excess or even a reduction/refusal of a claim. This includes any children you have with a driver's licence. 
  • Learner drivers don’t need to be listed on the policy until they get their probationary licence. A standard excess and other applicable excesses apply if the learner is driving at the time of the incident.  
  • Many insurers won’t cover a driver under the age of 25 while driving a high-performance vehicle.  
  • Some insurers also offer a nominated driver policy for an additional excess.

Requirements differ for insurers, so always check with your provider to see what you’re covered for. Remember to check out the relevant Product Disclosure Statement (PDS) for more information. 

3. Myth: If I'm uninsured but not at fault, I don’t have to pay 

If either you or the other party is uninsured, you need to disclose this at the scene of an accident. 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 be liable to pay damages, depending on the other driver’s cover.
  • If the ‘at-fault’ driver doesn’t have insurance, you’ll need to cover the cost of getting your own car fixed and any legal costs when trying to recover this from an uninsured driver.

Because of this, it’s important to know what to do if you're in an accident.

If you do have car insurance, this doesn’t mean you walk away from the accident without having to pay for anything. If you lodge a claim, regardless of who’s at fault, you may have to pay an excess. 

 

4. Myth: Car insurance doesn’t cover modifications/accessories  

Some car insurance policies cover accessories and modifications, though the insurer may need to know what they are. Talk to your insurer when you plan on making any alterations to your car. They may affect its value so much that your sum insured — that’s the maximum amount you can be paid if and when you make a claim — won’t be sufficient to repair or replace it.

When you get a quote for car insurance with us, we’ll factor any modifications into our assessment and discuss the amount your car can be covered for.

 

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5. Myth: Personal belongings stolen or damaged aren’t covered by car insurance 

Not true. With Suncorp Comprehensive Car Insurance, some personal belongings are covered up to a specified amount. This includes capped coverage for a trailer attached to your vehicle, any tools of trade that are locked in the vehicle and are stolen or are damaged in an incident, and even coverage for a baby capsule or child seat that is stolen or damaged.

6. Myth: Car insurance covers mechanical repairs and breakdowns 

Just as general wear and tear on your vehicle isn’t covered by car insurance, your mechanical repairs and breakdowns aren’t either.  

However, if you’re ever stranded on the road, Suncorp Roadside Assist can be added to one of our three levels of Comprehensive Car Insurance to help get you out of trouble. 

Remember: there is no cover for Suncorp Roadside Assist during the first 24 hours of adding the cover. For full coverage details, please see the Terms & Conditions.

7. Myth: How often I drive my car doesn’t affect my premium

This isn’t always true. It really depends on your insurer, with some providers giving more flexible insurance coverage compared to the past. This is because commuting and work habits have changed dramatically, requiring a more nuanced approach to coverage.

When receiving a quote for car insurance at Suncorp, you’ll be asked some questions about how/when you use your car which may result in cheaper premiums.

If you still have questions about insurance, check out some common FAQs and things you can do yourself online at Contact Us.

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Insurance is issued by AAI Limited ABN 48 005 297 807 trading as Suncorp Insurance.  Read the Product Disclosure Statement before buying this insurance. 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.