Henry Carus + Associates | Injury Lawyers

Learn About the Difference Between Third Party and Comprehensive Insurance

third party insurance in australia

With all the expenses that come with raising a family and simply getting by, it can be difficult to determine the right car insurance for you. This article will go through your options for choosing car insurance.

What is CTP Insurance?

Compulsory Third Party (CTP) insurance provides compensation to crash victims for personal injury if the policyholder is at fault. It covers passengers, pedestrians, cyclists, and other road users, and compensates for reasonable treatment and other expenses. In Victoria, it’s against the law to drive a vehicle without Compulsory Third Party (CTP) insurance. You pay for it along with your vehicle registration. The cost of CTP insurance varies wildly because it depends on many different factors, but an average person’s CTP insurance costs around $445 a year (or approximately $37 a month). CTP insurance is a great thing to have, but you should not rely on it to cover everything. CTP insurance does not cover you for damage to your property or the property of others.

Third Party Insurance

Third Party Damage Car Insurance provides extra coverage in case you damage someone else’s car or property. Some insurance companies offer Third Party Property Damage, Fire, and Theft insurance which additionally covers your own car if it is damaged by fire or is stolen. Car repairs can be very costly, and so Third Party insurance covering property damage to others will give you some peace of mind. However, Third Party insurance still won’t cover the cost of repair to your vehicle following an accident. This is where comprehensive car insurance comes in.

Comprehensive insurance

For most people, it’s better to go with comprehensive car insurance, because it typically covers more situations and therefore is more cost effective. Comprehensive car insurance will cover you for damage to your car caused by collision, flood, fire, storm, vandalism and theft. And it will also cover you for damage to other people’s car and property as a result of a collision involving your car. You can also tailor your insurance policy to cover other things you may need. For example, you can choose whether or not your comprehensive car insurance should cover rentals, or a range of car repairs like the removal of windscreen and glass damage.

Higher or lower deductible?

Price is always an important consideration when it comes to these things. The cost of your comprehensive car insurance relies on your deductible amount. A higher deductible amount means that you will have to pay more upfront in order to cover more damage before your insurance coverage kicks in. The upside to a higher deductible, however, is that you will get to pay a lower insurance premium. It’s basically a gamble: if you’re pretty sure you won’t get in a car crash, then a higher deductible would make sense for you. Then again, does anyone ever expect to get into a car crash? If you need help determining the right deductible amount, you can weigh your upfront premium savings against the amount of money you’re able to pay out of pocket in the event of an accident, theft, vandalism, or damage caused by Mother Nature.

Our advice: go with comprehensive

In order to ensure that your car insurance covers everything, you need to get both CTP and comprehensive insurance. With both types of insurance, you’ll be set for the whole year. Of course, with all the expenses that come with raising a family and simply getting by, it can be difficult to determine the right car insurance for you. But the laws of nature and the laws of the land both suggest that failing to have a backup plan in case of an emergency could prove to be the most costly expense of all. Henry Carus + Associates would be happy to assist you with your car accident claim, so don’t hesitate to get in touch for a free initial one-on-one legal consult. With over 40 years of experience, all of our work is done on a “no win, no fee” basis, guaranteeing that you do not pay any fees until we have won your case.