How to choose the right car insurance

When it comes to car insurance, everyone’s needs differ. That’s why when you get a quote, online or over the phone, you’ll be asked a series of questions. These questions are designed to help the insurer provide you with an accurate quote. Here are some common questions you may be asked: 

• How will you use your vehicle? (Is it for personal or business use)
• Who will drive your vehicle? What is their age, driving experience and history? 
• How often will your vehicle be used? (Roughly how many kilometres do you drive per year) 
• Where will your vehicle be parked overnight (Do you keep it in a garage, carport, or on the street) 

Some other things to consider include: 

• Your budget (including the cost of your insurance excess).
• The approximate value of your vehicle.
• If your car is financed, how much is still owing.
• How you might be affected if your vehicle is ever written off or being repaired after an accident. Could you manage short-term without a vehicle or is having a vehicle essential? Thinking about this helps you choose whether to insure your vehicle for market value or agreed value and whether cover that includes a hire car option could be important to you. 

If you’ve already got car insurance, your policy documents are a good place to start. Review these documents to see if your current car insurance policy still meets your needs, or if you want to make any changes.  

If you’re shopping for car insurance, you should find some helpful information in the policy booklets section on an insurer’s website. Information should include: 

• Product Disclosure Statement (PDS): Includes full details on a policy to help you understand what’s covered and what’s not, limits and conditions.
• Premium, Excess and Discounts Guide (PED): Helps you understand how the insurer calculates your premium, how much you might need to pay if you make a claim, and discounts you may be eligible for.
• Target Market Determination (TMD): Helps you understand the types of people insurance policies are designed for, considering their needs, objectives and financial situations.  

In the PDS, there’s usually a comparison table to help you compare exactly what is and isn’t covered by the different types and levels of car insurance offered. For each item covered, there's a detailed explanation of how the cover works that includes limits, exclusions, conditions and how to claim.  

Different types of car insurance include: 

• Third Party Property Damage: Covers damage your vehicle causes to other cars or property.
• Third Party Fire and Theft: Covers damage your vehicle causes to other cars or property, as well as damage to your car caused by fire or theft.
• Comprehensive: Covers damage your vehicle causes to other cars or property, as well as damage to your own car caused by a whole range of incidents (including fire, flood, storm, theft, vandalism and accidental damage such as from a collision. 

Some car insurance products might have additional benefits either already included, or available at an extra cost, like glass cover or hire car cover.

Did you know the PDS contains helpful information about the claim process and repair policies? Towards the end of the document, you can usually find claims examples, that describe how certain claims might be handled.  

Some insurers, including NRMA Insurance, may let you choose whether you pay for your policy monthly, quarterly or annually. To find out what payment options are available, check the insurance company’s website. 

Like we mentioned earlier, the PED outlines how your premium is calculated and how different types of excesses might apply to your policy. It also describes how any discounts or loyalty benefits work.

When you get a quote, you’ll be able to play around with different options to determine how the level of cover and any optional extras fit with your budget.   

If you already have car insurance, you may be able to make some changes to your policy yourself online, for example, adding optional benefits to increase your cover, or you may want to contact your insurer for help to make changes or to discuss your options. Depending on the change, there may be either an additional premium you'll need to pay, or you may be eligible for a partial refund. Information about making changes to a current car insurance policy can be found in the PDS. 

Still have some questions or need clarification? That’s OK! Contact the insurer and they’ll be happy to assist you. If you need help understanding an NRMA Insurance policy or quote, feel free to contact us. 

You’re now better equipped to buy, adjust or renew your car insurance with confidence. Don’t forget to check your policy details carefully once you buy to make sure it’s all correct and review your policy regularly to make sure it still meets your needs.