Do you need comprehensive car insurance?

Sheen Panel Service on 13 June 2019

There are four different types of car insurance in Australia, and only one of them is mandatory to drive legally on Australian roads. 

Compulsory third party insurance, also known as CTP insurance or a green slip, provides compensation for anyone injured in a traffic incident, and is mandatory in all states and territories. In Victoria, CTP insurance is included in the cost of registering a vehicle. So as long as your car is registered, you're covered by CTP insurance.

All other types of car insurance are optional, but CTP insurance doesn't provide any compensation for property damage, so it can be financially risky to drive without at least some level of additional insurance coverage.

Whether your car is insured or not, Sheen can help you with smash repairs and towing services

The risks of driving without insurance

Driving without CTP insurance is illegal in Australia. The penalties for driving an unregistered vehicle or without CTP insurance are large fines. If you're involved in an accident and you don't have CTP insurance, you could be held personally liable for any injuries to other road users. 

Driving without insurance for property damage can leave you financially liable for the cost of any repairs to your own vehicle, other vehicles, and any other property damaged in an accident. 

What happens in a car accident without insurance

accidents - the risks of driving without insurance

If the only type of insurance you have is CTP, here is what you can expect to happen if you're involved in a car accident:

If you're at fault

If you are at fault for causing the accident, then you will have to pay for any repairs to the other vehicle involved as well as any other damage caused in the accident. Depending on the value of the other vehicle and the amount of damage, you could be liable for a huge amount of money. 

If you're not at fault - Call Sheen first

If the other driver is at fault, then you will not be liable for the cost of repairs. If the at-fault party has comprehensive or third party property insurance, then their insurer will cover the cost of repairs. If the at-fault party doesn't have any insurance to cover property damage, then they will be personally liable for the cost of repairing your vehicle.

Types of car insurance

1. Compulsory third party insurance

As we've already mentioned, CTP insurance pays compensation to people who are injured on the road. It's illegal to drive anywhere in Australia without CTP insurance. In Victoria, CTP insurance is included in the cost of your vehicle registration. 

Risks at this level of insurance:

  • Not covered for damage to other people's property
  • Not covered for damage to own your vehicle or property
  • Not covered for fire or theft of your vehicle 

2. Third party property insurance

Third party property insurance covers you for damage your vehicle does to other people's property. If you're at fault in an accident, your third party property insurance will pay for repairs to other vehicles and property, but it will not pay for repairs to your own vehicle. 

Risks at this level of insurance:

  • You are not covered for damage to your own vehicle or property.
  • You are not covered for fire or theft of your vehicle.

3. Third party, fire and theft insurance

Third party, fire and theft insurance is just like third party insurance, but you will also be covered if your vehicle is lost or damaged due to fire or theft. 

Risks at this level of insurance:

  • You are not covered for damage to your vehicle or property in an accident.

4. Comprehensive insurance

Comprehensive car insurance covers you for everything already mentioned above, including damage to your vehicle or property if you are at fault. There are also many optional extras and differences between insurers, so make sure you fully understand your policy and what you're covered for.

Risks at this level of insurance:

  • You will not be covered if you breach your insurance policy, for example, if you are driving over the legal limit for alcohol consumption.

What insurance do you need? 

what happens in a car accident without insurance

The level of insurance that's right for you will depend on your circumstances. But it's always a good idea to have some level of optional insurance to cover third party property damage.

If you don't have third party property cover, you could end up being liable for tens of thousands of dollars (or more!) if you cause a vehicle to be damaged or written off in an accident. 

And of course, comprehensive car insurance is the best way to get the peace of mind that you're covered for pretty much anything that might happen on the road. 

Call Sheen first

At Sheen Panel Service, we can help you can get back on the road sooner after an accident. We work with insurers and motorists to provide the highest quality smash repairs and towing services you'll find anywhere in Victoria. 

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