The following guide might help you to shop for and buy your car insurance. When you purchase car insurance, it’s important that you understand your options so that you can choose the most appropriate cover for you.
- Always compare prices and benefits so that you are getting the best deal possible.
Understand that there are four types of car insurance policies:
- Third Party Property Insurance – this covers any damage to other people’s car or property as a result of a car accident involving your car. It also covers any of your legal costs, but does not cover any damage to your own car.
- Third Party, Fire and Theft Insurance – provides the same cover as “Third Party Property Insurance” plus cover for damage caused to your car by theft or fire. However, it doesn’t cover your own car if it is damaged in an accident.
- Comprehensive Insurance – this covers damage to your own car and to other people’s car or property and includes Fire and Theft Insurance.
- Compulsory Third Party (CTP) Insurance – when you register your car. This insurance covers you for any injury or death to people in a car accident. Due the enormous cost of medical expenses for injured people in car accidents, governments have insisted that all drivers have this insurance. Please note that Real Insurance does not currently offer this type of insurance.
- Modifications – Make sure you inform your insurer of any modifications or accessories to your car – such as mag wheels, spoilers or performance enhancements.
- Be aware of discounts for multi-policies – if you take out more than one insurance policy with the same insurer, it is likely that you will be able to gain a discount on your premiums. Therefore, it normally makes sense to have your home and contents insurance and car insurance with the same insurer. Real Insurance offers a multi-policy discount if you take out more than one home, contents or car insurance policy with us.
- Changes to usage – Make sure you notify your insurer of any changes which have occurred with regards to the car usage, address or parking situation. Gain approval from your insurer for such changes, so that you can feel comfortable that the insurance company has assessed any additional risk-factor and is prepared to continue your cover.
- Product Disclosure Statement (PDS) – Make sure you read the PDS so that you are aware of the insurance details.
- Exclusions – Make sure you are aware of any “general exclusions” to your policy. Such exclusions can include things such as:
- The car being driven by someone affected by alcohol or drugs.
- The car being driven by an unlicensed driver.
- Your car already having a mechanical or rust problem.
- Excess Level – You should select an “excess level” which you can afford to pay should a situation occur in which you need to make a claim.
- Premiums Paid – You should make sure that your insurance premiums are paid on time, so that you are fully covered in the case of any claim.
- Monthly Payments – Understand that most insurers will allow you to pay your premiums on a monthly basis, therefore allowing you to avoid one large annual payment. However, make sure that your 12 monthly payments do not total more than the one annual payment. (As some insurers charge an extra fee for monthly payments.) Real Insurance does not charge its customers any extra to pay for car insurance policies by the month.
- Check your Insurance Certificate – once you have selected an insurer, make sure you carefully check your Insurance Policy to ensure that all details and disclosures are correct. Many people only get around to checking such documentation when they need to make a claim – and for some, this is too late. Make sure you are covered for all of the things you intend to be covered for.