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Top 3 things to know about car insurance in NSW

You have a choice of insurance types

There are four main types of car insurance products available to a driver in Australia – one that is compulsory, and three that you can choose from to protect your car.

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Your premium is influenced by a range of factors

There are a range of factors that can affect the cost of your car insurance in NSW. It’s a smart idea to learn what these are – and how you can influence your premiums.

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Weigh up which extra features to add to your cover

If you drive in NSW, there may be car insurance features on offer to you so you can better tailor your cover. Adding these to your policy will cost extra, but you may benefit from the extra cover.

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A guide to car insurance in NSW

Last updated 21/02/2024

Kenneth Young
Written by Kenneth Young

Adrian Taylor
Reviewed by Adrian Taylor

What types of car insurance are available in NSW?

Comprehensive car insurance

Comprehensive car insurance offers the most coverage for your car. This type of car insurance policy covers the repair costs for accidental damage you cause to other people’s property. It also covers repair or replacement costs for your own vehicle caused by a variety of events, including accidents, storms and fires.

Third Party Fire and Theft (TPFT)

TPFT insurance can cover the cost of any damage you cause to another person’s car or vehicle. It won’t cover your vehicle’s repair costs if you’re at fault in a traffic incident, but your policy includes cover for the new car replacement cost of your vehicle if it’s stolen or destroyed by fire.

Third Party Property Damage (TPPD)

As the most basic level of optional car cover, TPPD car insurance can pay towards the repair costs for any vehicles or property you may damage in a car accident when you’re at fault. It doesn’t cover any repair costs for your own vehicle, except in very limited circumstances.

Green Slip (Compulsory Third Party)

Green Slip insurance is mandatory for all registered vehicles in NSW, as it covers the driver’s legal liability if anyone is injured or killed while in control of the vehicle on the road. In NSW, you have the option of choosing between several different insurers; the NSW state government’s Green Slip Check website can help you find this type of cover.

Which type of car insurance should I get in NSW?

Every car on NSW roads must be covered with Green Slip insurance, but how do you know which additional insurance you should buy and which policy is right for you? Choosing a level of car insurance essentially comes down to what your car is worth to you and whether you can afford the repair or replacement cost of your vehicle.

Comprehensive car insurance pays for repair costs for both you and other drivers following damages from an insured event. It also covers storm and fire damage on top of theft and offers a host of optional extras to choose from to extend your cover.

NSW Green Slip or CTP insurance is quite different in that it will only cover your legal liability if you cause injury or death to another driver in an accident where you’re at fault. It does not cover damage to your or other people’s cars and property.

To help you in your decision on which insurance policy is suitable for you, we’ve broken down what each level of cover could offer you.

Insurance typeDamage to your car in an accidentDamage to another person’s car or propertyDamage/loss caused by fire and/or theft
Note: Many factors and considerations may affect the level of cover you can receive. You should always read the policy’s relevant Product Disclosure Statement (PDS)for specific exclusions and conditions of your cover.

Which car insurance policy features should NSW drivers look for?

While some of the below features may be available as optional extras or services (at additional cost to you), they can be invaluable if you find yourself in a tight spot:

Policies will be subject to limits, sub-limits, exclusions and restrictions. You should always check your new policy’s PDS and Target Market Determination (TMD) to ensure it’s suitable for your needs.

The cost of car insurance in NSW

How much will car insurance cost in NSW?

The cost of car insurance in NSW depends on many different factors, each of which varies across each customer, so it’s a little hard to get an example of the average premium! For example, your car insurance premium will be affected by factors like your:

  • Car’s model, age and parking location
  • Claims history
  • Driving experience (how long you’ve had your Australian licence for).

Due to external and personal factors particular to you, for a more detailed idea of your potential car insurance costs, you can complete your own car insurance quote through our comparison service.

If you’re shopping for car insurance at the right price for you, read about how car insurance is calculated for a market value.

How does living in NSW affect your car insurance?

Your policy itself isn’t affected by the state you live in. The only difference to insuring a vehicle in NSW over another state or territory is that you must purchase Green Slip insurance before you register your vehicle. Elsewhere in Australia it’s part of your registration fees.

However, living in NSW does impact how much you pay for your insurance. Where you park your car at night, how far you drive each year and the crime statistics in the area in which you live can influence your premiums.

Will I have to pay an excess?

You may have to pay a basic excess when you claim on your car insurance policy whether it is for an at fault accident, a weather event-related claim or the third party responsible can’t be identified. Sometimes, you may even need to pay an additional excesses, such as a young driver excess (for drivers under a certain age) or an unlisted driver excess (if the driver wasn’t added to your policy).

Regardless of whether you have a comprehensive car insurance policy or a more basic third party car insurance, it’s important to let your insurer know about all drivers (including learner drivers) who use the vehicle as you may be required to list them on your car insurance policy. This may help you avoid some additional excesses in the event of a claim.

Depending on your insurer, you may be able to choose the basic excess amount for your policy. If you choose a higher excess, your premiums may be lowered as a result, and vice versa.

Important to know

What insurance do I need for my car in NSW?

Having mandatory Green Slip cover when driving in NSW doesn’t mean your car is protected. Accidents can strike at any time, so covering your car with another type of policy (whether Third Party Property Damage, Third Party Fire and Theft or Comprehensive cover) can give you peace of mind when you’re on the road.

Will my car insurance change much if I move house?

Potentially, yes. Your postcode can affect your insurance premiums because your new neighbourhood may have a different rate of drivers making insurance claims. Also, where you park at night can affect your car insurance premiums. For example, if you park in a locked garage, your premium will reflect the lower likelihood of it being stolen, whereas parking it on the street may have the opposite effect.

Also, traffic accidents in your neighbourhood can affect your insurance premium. It’s best to give your insurer a call when you plan on moving not only so you can budget for the new price, but also so you don’t risk any future claims being denied because your insurer didn’t know about your new address.

Do car insurers in NSW offer no claim discounts?

A range of car insurance providers operating in NSW offer no claim discounts. You’ll have to hold your policy for a set number of years without making a claim to be eligible for this discount.

Car thefts in NSW

The number of car thefts in NSW is one of the highest in the country. As of December 2022, motor vehicle theft in NSW has risen 17% over the last two years, standing at 12,274 motor vehicle car thefts in NSW that year.1

Drivers in NSW who have a comprehensive car insurance policy or a TPFT policy can be covered against car theft.

Adrian Taylor

Meet our car insurance expert, Adrian Taylor

As Executive General Manager of General Insurance, Adrian Taylor works hard to make sure consumers have the facts when it comes to their car insurance, including what’s covered and how comparing policies can help them get the most value from their insurance purchases.

Adrian has over 13 years’ experience in the financial services industry. He helps review general insurance content on Compare the Market to ensure it accurately breaks down complex insurance topics.

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