What’s the difference between comprehensive and third party car insurance?
Let’s face it — car insurance can get confusing. Do you need third party car insurance or comprehensive car insurance, or both? And what is third party fire and theft car insurance?
Compare Club’s team is here to help cut through the car insurance complexity so it’s easy to find the right cover for you.
Key Points
Third party property damage car insurance covers accidental damage you cause to other people’s cars and property. This is not to be confused with Compulsory Third Party (CTP) car insurance, as this is required when registering vehicle for road use. Each state has a different name for CTP.
There is a difference between CTP and third party property damage car insurance. CTP is Third Party Bodily Injury Insurance, which is insurance if you injure someone while driving (such as a pedestrian), whereas third party property damage car insurance is if you hit something like a house, telegraph pole, bridge, garden and more.
You’ll pay more for comprehensive car insurance, but it offers a broader level of coverage.
What is comprehensive car insurance?
Comprehensive car insurance covers damage to your car, and damage your car might cause to other cars or property.
Damage to your car that occurs in an accident, or due to weather events such as floods, fire or storms, is typically covered by comprehensive car insurance.
However, exactly what is covered under a comprehensive car insurance policy tends to differ between insurers.
So it’s important to always understand the terms and conditions of a comprehensive car insurance policy before you sign up.
There are many different comprehensive car insurance policies available from a range of insurers. So finding the right policy for you can feel a little daunting.
Compare Club’s team are here to make it easy. We can compare a range of comprehensive car insurance quotes to help find the right policy for you in just a few minutes.
What is third party property damage car insurance?
Third party property damage car insurance covers damage your car causes to other cars or property, or injuries caused to other people in an accident.
However, it does not cover damage caused to your car.
There are a couple of different types of third party car insurance that you should be aware of:
Compulsory third party bodily injury (CTP) car insurance covers your liability for injuries caused to other people in a car accident. In New South Wales, you must have a CTP insurance policy — also known as a Green Slip — in order to legally register and drive a vehicle. In other states, your CTP premium is generally included in the cost of registering your car. This is similar for other states and territories of Australia.
Third party fire and theft car insurance covers the cost of damage to your car caused by fire or theft as well as third party property damage.
What is third party fire and theft car insurance?
Third party fire and theft car insurance also covers:
Fire damage to your car
Theft and associated damage to your car
There is no other cover for damage to your vehicles except for fire damage or theft. You are also covered for third party damage, such as damage to other vehicles or hitting a pole. You are NOT covered for damage to your car.
Compare Club’s team can help you find the right third party car insurance for you. All it takes is a few minutes of your time.
What’s the difference between comprehensive and third party property damage car insurance?
Third party property damage car insurance generally covers:
Damage your car causes to other people’s cars in an accident
Damage your car causes to other people’s property (for example damage to roads, bridges, buildings, sign posts) in an accident
Injuries your car causes to other people in an accident
If you hold third party fire and theft car insurance, you’ll also be covered for fire damage to your car and the theft (plus associated damage) of your car and no other.
Comprehensive car insurance generally covers the costs associated with:
Damage your vehicle causes to other road users vehicles in an accident
Damage caused to your vehicle in an accident
Damage caused to your vehicle in a storm, fire or flood or any other weather event
The theft (and associated damage) of your car
Comprehensive car insurance premiums are typically more expensive than what you’ll pay for third party car insurance. However, comprehensive car insurance offers a higher level of coverage.
Compare Club’s team can help you save on comprehensive car insurance. We can help you compare quotes, adjust your excess and lower your premium in just a few clicks.
What does comprehensive car insurance cover?
While comprehensive car insurance generally covers damage to your vehicle caused by an accident, storm, fire or flood, exactly what is included in your policy differs between insurers.
Some insurers will include some of the following cover in their standard comprehensive car insurance policies, while others will offer them as optional extras you can choose to add to your policy.
Roadside assistance typically covers basic roadside repairs such as tyre or battery replacement, and the cost of towing your car if required.
Windscreen cover generally pays to replace your windscreen if it is chipped, cracked or otherwise damaged in an accident or storm.
New for old car replacement can be a good option if you’re insuring a brand new car. If you new car is written off within two years (some insurers offer three years) of being purchased new, your insurer will replace it with a new vehicle of the same model.
Personal effects/property insurance covers damage to any personal property that was inside your car at the time of the accident. It may also cover any property that is stolen from your car.
Accident hire car coverage will pay for a hire car for you to use while your car is being repaired following an accident. Most insurers will cover hire car costs following a theft but not from an accident.
Compare Club’s team do car insurance differently and can help you compare quotes to find the best value.
Comprehensive vs third party property damage car insurance: Which one is better for me?
That depends on what you want from your car insurance policy. For starters, you must hold compulsory third party bodily injury (CTP) car insurance, so that’s non-negotiable.
Your next step really depends on your budget and the value of the car you drive.
If you’re on a tight budget, drive a lower value car or are looking for a cheaper premium, third party property damage car insurance will protect you against the cost of having to pay for other people’s car repairs or property damage in the event of an accident.
If you don’t mind paying a little more or drive a higher value car, comprehensive car insurance will cover the cost of damage to your car as well.
The verdict
While you may pay slightly higher premiums for comprehensive car insurance, it offers a much broader level of coverage. That means you won’t be out of pocket if your car is damaged or stolen.
If you can’t quite stretch your budget that far, third party property damage car insurance will ensure you don’t have to pay for other people’s car repairs. And that’s a big deal if you happen to hit an expensive car!
The good news is that Compare Club’s team can help you find the right car insurance for you. And if the premium is too high on your chosen policy, we can help you adjust your excess to lower the cost in just a few clicks.
This guide is opinion only and should not be taken as financial advice. Check with a financial professional before making any decisions.
GENERAL ADVICE WARNING: General Advice is advice that has been prepared without considering your current objectives, financial situation or needs. Therefore, before acting on this advice, you should consider the appropriateness of the advice having regard to those objectives, situation or needs.
If the advice provided relates to the acquisition or possible acquisition of a new insurance policy you should consider the insurers PDS prior to making the decision to purchase their product. Information regarding the income we have been paid by the insurer for this transaction is available upon request.
