5 car insurance tips for young drivers

As much as you’re celebrating your newfound freedom on the road – you might be a little stumped by car insurance. Maybe you have questions about what level of cover you need and why car insurance is important. We get it. It’s a big expense fronting up money for something that ‘might’ eventuate.

So why should you consider car insurance carefully? Well, it’s a necessary cost for all drivers on Australian roads. Because, without insurance, you run the risk of having to fork out big out-of-pocket expenses if you have an accident. And for the first time driver, your inexperience on the road is more reason for having car insurance cover if a prang were to happen.

Here are five things you’ll want to know about car insurance for young drivers.

1. Research what level of cover you need

Researching the best insurance for young drivers could save you some money. But even before Googling ‘car insurance under 25’, you might want to ask yourself these questions:

• How much do I drive? This will be useful for thinking about what level of cover you need, along with how much you’re willing to pay on excess and premiums.
• Where do I park overnight? Whether it’s safely locked up or parked out on the street, you could save more money by storing your car under lock and key.
• What’s the condition of my vehicle? You may think about how much your vehicle is worth, and whether your vehicle is worth insuring. For example, if the worth of the vehicle is low, then this may affect your decision on the level of cover.

Armed with these questions you might be in a better place to decide on the level of cover you need. Here’s a quick summary of car insurance options to help you decide.

Comprehensive Car Insurance

Comprehensive Car Insurance is the ‘bells and whistles’ option and provides a premium level of cover for motorists, such as cover against collision and damage, and any legal liability arising from an accident. If you’re after heavy-duty cover (even if you’re at-fault in an accident) – comprehensive might give you the green-light to cover your vehicle.

Third Party Car Insurance

Want cover against damage to another person’s vehicle or property? Third Party Car Insurance does just that. So if you were to crash into a flashy car (and luck wasn’t on your side), Third Party will usually pay for the costs of damage and repair to the other party’s vehicle. However, you will have to foot the bill for any damages made to your car with this level of cover. You can also add cover to your car caused by Fire or Theft only for an extra premium. This will ensure liability cover for loss or damage from fire and theft, and could even sort out a hire car after theft depending on your policy.

Compulsory Third Party (CTP) Insurance

Compulsory Third Party Insurance (CTP) or ‘Green Slip’ insurance is mandatory for Australian drivers when you register your vehicle. It covers the cost of third party compensation claims, like if you were to accidentally injure a pedestrian during a car accident. If you live in New South Wales or Queensland, you can choose your CTP insurance provider.

Explore Suncorp Car Insurance Cover

2. Consider getting roadside assistance

If you choose Comprehensive cover, think about what additional features you might need. For example, if your car tyre burst on a busy highway and you have to pull over – do you have roadside assistance to call on? Being stuck in tricky situations can happen more often than not. Thinking about getting optional extras added to your car insurance is an important consideration. Suncorp Roadside Assist is available as an extra for Comprehensive Car Insurance policyholders and can cover your emergency break down, and even organise alternative transport for you. It’s a good way to feel confident that someone can get you out of trouble when you need it most.

3. Weigh up your excess and premium costs

The excess is the amount you pay or bear for each incident covered by your policy. Because excess amounts vary and are determined by the level of cover and cost of your premium, it’s hard to put a figure on what your average excess costs. Generally, a higher excess will mean that you’ll have a lower premium or visa-versa, but it really comes down to considering what’s right for you. For example, you may not drive often and feel that you’re less likely to make a claim, so you might opt for a higher excess and lower premium.

4. Read the policy documents

There’s more to insurance than paying the premium and putting it aside (at least until the next policy renewal). You’ll want to explore what your policy covers, including any restrictions and exclusions in more detail. And when it comes down to the nitty gritty, a product disclosure statement (PDS) is usually the best port of call for understanding what’s included in your policy cover. While policy documents might not top your list of must-read fiction, taking some time to learn about your insurance can be super helpful when you’re making a claim or thinking about upgrading your insurance.

5. Tell your insurer when your circumstances change

Let your insurer know when your circumstances change, for better or worse. This is because policies can reflect changes in your life circumstances, like moving house or changing vehicle ownership. It can also be a chance to save a buck or two. For example, if you’re moving home your premium could go up or down depending on where you move to and where you park at your new property.

Read more:

• When is it time to sell your car?
• Your essential car maintenance guide
• What kind of car insurance do I need?
  

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 is appropriate for you before acting on it.

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