If you are a vehicle owner on a quest to learn some truths about car insurance, we have busted a few common myths in this article. Without knowing the right things, you may not choose the correct cover for your vehicle’s needs. While it may cost you to have comprehensive car insurance premium, it does mean your vehicle (and therefore your bank account) is covered in a range of situations. The best car insurance covers your vehicle damage costs if your ride meets with an accident, with only a small excess to pay.
We discuss here four common misbeliefs surrounding car insurance.
Myth 1:
“In Australia, the most basic car insurance is always included in the cost of registration.”
Fact: This statement is not entirely true. Going by Australian law, it is mandatory to have compulsory third party (CTP) insurance (sometimes called motor accident injuries (MAI) insurance) if you register a motor vehicle in your name. These insurance policies cover you for any third-party injury/mortality caused by that vehicle, not damage to your vehicle or others’ vehicles/property. Some Australian states and territories include the cost of CTP/MAI in your vehicle registration charges, while others require you to buy CTP/MAI before your car registration.
Having this kind of mandatory insurance is crucial for you and for others on the road. For instance, if you bump into a pedestrian or a cyclist unintentionally and the person gets injured, this type of policy will provide them with compensation for medical bills, treatment costs, and lost income.
Myth 2:
“I have an insurance policy, so anybody driving my vehicle will be covered.”
Fact: Policyholders suffer much confusion with this topic. If someone driving your car for a covered event isn’t listed on your car insurance policy, you may need to pay some additional excess at the time of the claim or risk a reduced cover or outright claim denial. It depends on your vehicle insurance provider on what happens next.
Learner drivers must be listed on the policy once they get their probationary license. Otherwise, a standard excess and other relevant excesses apply if a learner drives during a covered event.
Most insurers may not cover an inexperienced driver while they are driving a high-performance vehicle. Also, a few insurers offer a nominated driver policy for an additional excess.
While these conditions vary from insurer to insurer, it is best to carefully read the policy disclosure statements or get in touch with your insurer to know more about what is covered for a specific scenario.
Myth 3:
“If I am not at-fault and uninsured, I don’t have to pay, right?”
Fact: After you confront a car collision, you and the opposite party must disclose the insurance details. Being dishonest will most likely complicate the claims process and make it arduous for the drivers and insurance providers.
Even if it wasn’t your fault and you don’t have car insurance, you may be liable for damages depending on the other driver’s cover. Suppose the at-fault driver doesn’t have insurance; you may have to spend money from your pocket to get your ride fixed and later spend on legal services when you are trying to recover the money from the uninsured driver.
We have untangled the most common misconceptions about car insurance, so you know what the reality is. You must also know that only a comprehensive car insurance policy covers your vehicle’s damages if you are a party to a car collision. So far, a comprehensive approach is the car insurance quote plan available in the market when it comes to coverage. Find an affordable insurance plan to keep your vehicle covered for a wide range of damaging events – and anyone else’s vehicles and property you may damage accidentally.