Being a loyal driver could cost you $1490

Being a loyal driver could cost you $1490

RateCity shows you why leaving your comfort zone and comparing comprehensive car insurance could save you more each year.

August 20, 2010

Sometimes there is a level of comfort in sticking with the things we know and trust. But if staying loyal to a company means that you could be paying more than necessary, wouldn’t you be interested in the alternatives?

Currently two car insurance companies, Suncorp Metway and the Insurance Australia Group (IAG), hold around 80 percent of the market share for car insurance. While the two offer their own insurance products, they are also underwriters for a number of major car insurance companies. For example under the Suncorp umbrella there is AAMI, Bingle and GIO just to name a few, while IAG is behind CGU, NRMA, The Buzz plus others.

According to RateCity’s recent bi-annual car insurance comparison throughout Australia, when it comes to the prices offered by these two main players, they are closer to the expensive end of the spectrum, with some exceptions including Bingle, which is an online-based low-cost brand and were one of the cheapest overall.

RateCity’s CEO, Damian Smith says, “Our research proves that there are a large number of people who could be paying more for their car insurance simply by sticking with who they know and trust. It is possible that the majority of these people don’t compare otherwise they would make the switch.”

Why stay when you can save
For instance, RateCity found that out of the four suburbs it surveyed in Sydney, drivers could save potentially $1250, with the dearest quote from the same western location of $1965 by Suncorp and the lowest at $720 from AAMI. While in Melbourne the most expensive premium in four suburbs across the city was with Suncorp at $2107 and the cheapest was with Youi at $618, showing a saving of close to $1490.

The good news is that switching car insurance is relatively easy, there are usually no fees involved (unless you break a current contract) and it can be done instantly. However make sure you consider a few things before making the switch, such as:

  • Claim rate. Ask the insurance company you are interested in for the percentage of how many claims are approved and how many aren’t. This way you can gauge how reliable they are.
  • Inclusions and extras. Check what is included in the policy and what isn’t. Just because one insurance company may cover one thing, it doesn’t mean that others will. Also check what options you may have to pay extra for such as car hire.
  • Consider the smaller players. Some of the smaller and not so well known companies can be more competitive in price.
  • Level of service. How does the new company operate? Are they online only or do they have a dedicated call centre?

So ask yourself, why are you with your current car insurer, and if the answer is because you are loyal or they are a well known company, then what are you waiting for? Compare car insurance quotes online today and see how much you can save.

 

 

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Learn more about car insurance

Does insurance cover a stolen car if keys were in the car?

A car insurance policy that covers the theft of your car, such as third party fire and theft insurance, usually covers a stolen car, even if the keys were in the car’s ignition.

However, your insurer may deny the claim if you live in an area where there have been several car robberies reported recently. They will see you leaving the keys in the car as a case of negligence. In such cases, your insurance provider may even expect you to have installed anti-theft security measures in your car. 

You may need to confirm whether or not you left your keys in your car, and if they had been stolen or misplaced, before filing your car insurance claim. The loss or theft of your car keys may be covered by a comprehensive car insurance policy, but usually as an optional item.

If you can confirm that your car keys were stolen, mention this in your claim as this will help establish that your car was not stolen as a result of your negligence.

Can you insure your car for 6 months?

Most Australian insurers won’t offer you a 6-month car insurance policy, so you may need to buy a policy that covers your car for damages and cancel it after six months. You will need to purchase comprehensive car insurance to protect your car from accidental damage, theft, vandalism, or natural disasters.. 

Consider checking whether your 6-month comprehensive car insurance will cost more if you pay monthly or six-monthly premiums instead of a one-time annual premium. Another question to ask the insurer is whether you’ll need to pay administration or cancellation fees when you cancel the policy.

Alternatively, you can look for a suitable ‘pay as you drive’ car insurance policy, which usually offers you the coverage of a comprehensive car insurance policy but only requires you to pay for the distance driven. Such a policy may not be the ideal 6-month car insurance plan as it is based on how much you drive rather than for how long. If you need to drive a lot, you may end up paying more than you’d pay for regular car insurance. 

Can I drive a new car without insurance?

It is illegal to drive a car in Australia without insurance. Most states require that you get your insurance in place before you drive the car off the dealership’s plot. So, the answer to whether driving a new car without insurance is no, it is not allowed.

The only time you can possibly legally drive an uninsured car is when you have to get the vehicle registered. You should drive straight to an inspection station or your state's vehicle registry. You must also make sure that you take the most direct or convenient route possible.

It is important to note that your compulsory third party insurance (CTP or green slip) isn’t valid until your car is registered.

Driving an unregistered or uninsured vehicle can have severe legal repercussions. If you are involved in an accident, and are driving an unregistered and uninsured vehicle, you will be personally liable to pay compensation to anyone hurt, as well as for damages. If you are caught driving a vehicle without insurance, you may be fined or even have your vehicle seized.