What You Need to Know Before Buying Car Insurance

If you own a car, then it’s essential to have motor insurance. Typically, in the case of a road accident, your car insurance will help you recoup expenses spent on reparations. In addition, depending on the type of coverage you’ve signed up for, you may be eligible for a few other types of claims as well, including medical. Hence, in the most basic sense, car insurance provides with peace of mind.

There’s no doubt about it: car insurance is expensive. For instance, a survey done in 2018 shows that the average annual premium for a car insured in New South Wales is around a $1000. In Tasmania, this comes to around $692. In addition to your location, there are other things that affect how much you’ll end up paying. For instance, in general, younger drivers get charged more than older, experienced ones. The type of car is one major factor that affects the cost of premiums. You’ll pay way more to get a sports car insured than you would for a minivan.

If this all feels a bit confusing, don’t worry. Here are the most important things you need to know before buying car insurance:

Know Your Coverage Options

When you’re purchasing insurance from a lender or a reputed dealership like berwickhaval.com.au, you’ll have many different coverage options to consider. Here are a few examples:

  • Property damage liability – this covers the costs incurred if your car damages someone else’s property.
  • Medical – This covers the costs of medical bills (in the instance of an accident) for you and any other occupants of the car.
  • Bodily injury liability – if your car hurts or ends up killing someone, this option will cover claims of injury or death against you.
  • Physical damage – covers any physical damage to your car caused by vandalism, theft, fire and natural disasters such as hurricanes and floods.

Know What to Expect for Your Own Vehicle

As mentioned above, you’ll be charged more or less depending on the type of vehicle you own. Here’s how insurance determine this:

  • The more expensive your car is, the higher the premium is going to be. This is because it’s going to cost the insurance company more to replace it or pay for spare parts and repairs.
  • The bigger your car is, the lower the premium is going to be. Typically, larger vehicles are better at surviving collisions so you could insure these for less.
  • The more likely your car is to be stolen, the higher you’ll pay for insurance. This is because of the added risk the insurer is taking on.

Know How You Affect Your Own Premiums

In addition to your vehicle, your status and records have an effect on how much you’ll pay for insurance. Here are some common factors:

  • Age
  • Marital Status
  • Residential area
  • Miles driven per year
  • Records of traffic violations

Out of these, you have the most control over the latter two. By reducing how much you drive a year and having a clean driving record for a long while, you’ll be able to convince insurers to lower the premium that you have to pay.


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