If you have a car, you need to have auto insurance. Car insurance insures you from financial losses for the damage that could arise from a car accident, a theft incident, and other unexpected expenses in relation to the type of insurance policy you’re using.
There are several auto insurance coverage options, so it’s important to choose the right one. There are many factors that you should consider when choosing your motor vehicle insurance cover, you should therefore make sure that price is not the only factor that you think about. Some of the factors that you should consider include the nature of the car, your driving record as a driver, and the area where you live amongst others.
Before you sign up for an insurance policy, it’s important to read the policy documents provided by the insurer. The policy document outlines all the key features of your insurance policy such as the level of coverage, any exclusions or limitations, and any terms and conditions.
Several policies will need to be tailored to your situation and depend on your particular risk factors.
Understanding car insurance costs can help buyers compare the cost of car insurance across different automobiles. Anything that puts your financial burden on someone else also places the responsibility on you.
But plenty of money can be saved if you use a belt and hitchhiker insurance: it will cover you in the event of any car breakdowns and pedestrians or cyclists you bump into.
Types Of Insurance
There are four major types of insurance in Australia.
- Compulsory Third Party (CTP) insurance.
Your CTP insurance will apply to any injuries you cause to another person in a motor vehicle accident. CTP insurance – sometimes called third party insurance, compulsory third party insurance or simply third party insurance – is a compulsory type of motor vehicle insurance that covers the policyholder and other people who may be injured in an accident caused by the policyholder.
- Comprehensive Insurance
Comprehensive insurance covers damage to your own vehicle and other people’s property, as well as theft and some other risks, plus legal costs. It pays regardless of who was at fault. Comprehensive insurance is optional and is quite expensive if you don’t have any major assets. This insurance offers the greatest peace of mind to car owners.
- Third Party Property
Third-party property damage insurance covers damage to other people’s property and legal costs. It gives you protection if you are responsible for damage to property that someone else owns. It also covers legal costs that you might face if you are sued. But it does not cover damage to your own vehicle or any injuries to yourself or your passengers.
- Third Party Fire & Theft
Third-party fire and theft insurance is similar to third party property damage, only difference is that this one provides added benefits that cover you in the case of a fire outbreak or theft.