Drivers risk safety to save money

Drivers risk safety to save money

April 14, 2011

More than one-third of motorists in Brisbane, Sydney and Melbourne have forgone necessary car servicing in the past year for financial reasons, according to a new survey. Meanwhile, more drivers purchased comprehensive car insurance last month than in February 2011.

A recent report from Budget Direct revealed that almost a quarter of those drivers also deferred replacing tyres on their vehicle in 2010, while more than one-third skipped mechanical repairs due to financial strain.

“Many of our customers have put off the preventative servicing because they are feeling the pinch and as a result we have seen safety items neglected and expensive repairs become more prevalent,” Ultra Tune chief executive Sean Buckley says in the report.

Cost before safety
Worryingly, the Budget Direct research also revealed that when purchasing a new vehicle, the need for good value far outweighed the need for safety features for drivers in all three cities. Overall, 64 percent of respondents said the initial cost of the vehicle was the most important factor in their decision, while only 22 percent ranked safety features top of mind.

It’s a worrying result given that in NSW alone road accidents cause more than 400 deaths and 25,000 injuries each year, according to NSW government Roads and Traffic Authority statistics. Aside from the personal loss and suffering caused by accidents, the financial cost

to our community is around $3.7 billion each year.

Insurance levels up
While motorists tightened spending on car maintenance in 2010, many realised the value of comprehensive car cover and sought out car insurance quotes in recent months. In fact, there was a 20 percent jump in the number of Australians purchasing comprehensive car insurance through RateCity in March 2011 compared with the previous month.

By comparing car insurance quotes online, some drivers could save as much as $1000 for some premiums, too. For instance, RateCity’s Bi-annual Comprehensive Car Insurance Comparison revealed that one of the cheapest insurance quotes available in February for a

Sydney driver was with Bingle at around $776. By comparison, Bendigo Bank‘s premium for the same driver and car profile was around $1764.

With the money saved on car insurance, a driver might be able to afford the services or new tyres that they were previously forgoing and feel safer on the road.




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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.