It costs more to insure your car in Sydney than Melbourne

It costs more to insure your car in Sydney than Melbourne

Are you paying too much for your car insurance? RateCity’s study on Melbourne comprehensive car insurance premiums could encourage you to compare now before you renew your next policy.

July 16, 2010

When it comes to comprehensive car insurance, almost everyone could be charged a different price. The amount we pay can be determined by our age, the type of car we drive, our driving history and where we live. But the insurance company we decide to trust with our policy is another variable. So when it comes to finding the right provider, does it really pay to compare online?

RateCity recently put the spotlight on Melbourne, as part of its bi-annual review on comprehensive car insurance, which showed that Melbourne drivers could be paying $1000 more on average for their comprehensive car insurance.

The average cost for Melbourne drivers in the study was $960, which is $174 less than Sydney’s average cost of comprehensive car insurance ($1134) for the same driver profile across four different suburbs.
The Melbourne study compared 26 car insurance companies across four different suburbs in Melbourne (Doncaster, Seddon, Meadow Heights and Caulfield) with the following results:

  • Meadow Heights paid the highest premium overall with an average cost of $1082.72. It also included the biggest gap between the lowest and highest cost of cover of almost $1500 or 71 percent difference.
  • Drivers in Doncaster paid the lowest for their comprehensive car insurance, at an average of $906.04. The difference between the cheapest and most expensive premiums was $800.10.
  • The cheapest premiums were all from online-based businesses including Bingle, Budget Direct, Youi and The Buzz.
  • The most expensive quotes were from some of the biggest players in the market including AON, Suncorp, CGU and St George Bank.

“It is hard to understand how the difference in price for the identical driver profile with the same address can have such varying degrees of car insurance quotes,” RateCity CEO Damian Smith said.
“But what this means is that there is a lot of money to be saved by most drivers and the easiest way to get the best deals is by shopping around and comparing car insurance online.”
Smith said features and services may vary between insurance providers so make sure you read the product disclosure statements carefully before signing up.

“There are obviously many other features besides price that drivers should think about, and we encourage drivers to look closely at all aspects of an insurer’s offering,” Smith said.

So whether you live in Melbourne or Sydney or any other part of Australia, there is a lot of money you can potentially save by comparing car insurance online.



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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.