How To Choose The Right Car Insurance For You

Car crashes happen. It’s an unfortunate fact of life.

But by making sure you’ve got the right car insurance in place, and by knowing how to use it, you can be confident your finances won’t take a dent.

Here's our step-by-step guide to help you get the best car insurance – and get the most from it if you have an accident.

Read the fine print

First things first: when you’re taking out a policy, read the Product Disclosure Statement. Sounds obvious, maybe, but understanding the difference between more pricey comprehensive insurance (which covers the most scenarios) and third party-only cover (which just covers damage to another person’s vehicle or property, not your own) is crucial when you’re picking a policy.

Everyone’s different, so be aware that if you’re under 25 you might be up for higher premiums, and even your type of vehicle could impact what you pay.

Take your full financial situation into account when you’re deciding which policy is right for you. Hopefully you won’t need to use it – but if you do, knowing you’ve already digested the fine print means you won’t be caught unawares.

Negotiate the best insurance payout

If you’ve had an accident, be ready to advocate for yourself. Insurers are looking to pay out as little as possible, so you need to have evidence and facts ready – not emotion.

If you believe you've received a raw deal, it's okay to say so - after all, mistakes sometimes happen. At the same time, nobody wants to go through the hassle of engaging lawyers, so an open and honest conversation is the best place to start.

If you feel that the outcome still isn't acceptable, you can elevate it to the Australian Financial Complaints Authority (AFCA): an independent body that can help arbitrate disputes. The Financial Rights Legal Centre has a comprehensive factsheet that explains the process in depth.

Re-evaluate your needs

If you've received your payout, now it's time to plan ahead. Do you see yourself starting a family? What about moving to the country or setting up your own business?

Believe it or not, the car you choose will directly impact the success of these endeavours. After all, it's hard to imagine two-point-four children squeezing into the back of a hatchback or two-seater sports car. Once you're clear on what you need, you can make more informed decisions that will save you the stress and costs of seeking out a new ride in a couple of years' time.

Do your research

Once you've decided what your next set of wheels will be, it's time to get down to brass tacks and start some in-depth research. The more time you take to assess the market and learn your alternatives, the more you're likely to get a better deal. Then start thinking about how you're going to pay for it. Everything will come down to your individual circumstances, but with your insurance payout, savings and finance options, there are many roads to explore.

It's time to start a new chapter

Whichever way you go from here, know this: life is full of ups and downs. We can never guarantee what, when or how things will turn out. All we can do is the make the best of our current circumstances and look to the future with excitement and hope.

Happy driving.