CTP vs Comprehensive car insurance
What’s the difference between CTP and comprehensive car insurance?
The main difference between Compulsory Third Party (CTP) insurance and comprehensive car insurance is that CTP only covers third-party personal injury and death claims arising from an accident you caused. Comprehensive car insurance can cover both the damage to your vehicle and the damage to a third party’s vehicle or property in an accident.
What is CTP Insurance?
CTP insurance is compulsory insurance in Australia as it covers an at-fault driver’s liability for the costs of third-party injuries or death in the event of an accident. It does not cover the cost of damage to any vehicle or property.
In some states, CTP may include cover for personal injuries regardless of blame, while others exclude cover for the at-fault driver.
CTP is required by law, but how you obtain your CTP insurance differs across states.
- CTP insurance is included in the cost of vehicle registration in Victoria, Western Australia, Tasmania and the Northern Territory.
- In Queensland, the ACT and South Australia, you can select a CTP insurer when registering or renewing your vehicle.
- In New South Wales, where CTP insurance is known as ‘Green Slip’, you must purchase it before registering your vehicle.
What is comprehensive car insurance?
Comprehensive car insurance can cover you for damage to your vehicle as well as other people’s vehicles or property resulting from an accident you caused. It’s the most extensive car insurance policy available for Australians, covering both damage to your own car and your liability for the damage you cause to another driver’s vehicle or property in the event of an accident.
Comprehensive car insurance covers a wide range of incidents, including accidents, theft, fire, vandalism and natural disasters. It may also offer additional benefits such as roadside assistance, accident hire car cover and a reduced or removed excess for windscreen damage at an additional cost. Comprehensive car insurance can also cover you if your car is declared a total loss from a motor vehicle accident. How much you are covered for will depend on whether you have an agreed value or market value policy. Always check your policy details.
Remember, comprehensive car insurance cover can differ across policies and providers. It’s important to read the relevant Product Disclosure Statement (PDS) to ensure you know your policy’s terms, conditions, exclusions and the coverage you’ll receive. You can also read the Target Market Determination (TMD) to see if the product suits you.
Does comprehensive car insurance include CTP?
No, comprehensive car insurance doesn’t include CTP. CTP is a separate insurance that is mandatory for all registered vehicles in Australia. CTP insurance covers compensation owed by an at-fault driver for third party personal injuries or death resulting from a car accident. In contrast, comprehensive car insurance offers broader coverage for various incidents and damage to vehicles or property.
Do I need comprehensive car insurance if I have CTP?
Comprehensive insurance is optional but provides more extensive coverage compared to CTP insurance.
The decision to get comprehensive car insurance depends on your circumstances, budget and the level of protection you want for your vehicle. It’s a good idea to compare different insurance options and consider factors like the value of your car, your driving habits and your willingness to take on financial risk.
If you want an idea of how much your comprehensive car insurance may cost, you can get a quote from our comparison service.
Why is comprehensive car insurance so expensive?
Comprehensive car insurance, as the highest level of coverage available for your vehicle, typically has the highest insurance premiums due to its extensive protection. It covers damage to your car you cause, as well as your legal responsibilities for any vehicle or other property damage your vehicle may cause in an accident. Comprehensive car insurance also covers various incidents, such as accidental damage, theft, vandalism, natural disasters and third-party property damage.
There are a few ways you can potentially reduce your premium depending on your insurance company, such as setting driver age limits or opting for a higher excess. You will need to pay this excess in the event of a claim though, so make sure you’re comfortable with paying a higher amount. Researching and comparing different comprehensive car insurance policies may help you find one that best fits your budget.
Do I need third party property damage cover if I have comprehensive car insurance?
No, you do not need third-party property insurance if you have comprehensive car insurance. Comprehensive car insurance usually includes the covers provided with third-party property damage policies. However, comprehensive car insurance doesn’t provide the same level of coverage as CTP insurance, which covers liability for death and injury to third parties, so you may want to consider a comprehensive policy in addition to CTP.
Meet our car insurance expert, Adrian Taylor
As a General Insurance expert with over 13 years’ experience in financial services, Adrian Taylor is passionate about demystifying car insurance for consumers, so they have a better understanding of what they’re covered for. Adrian’s goal is to make more information available from more insurers, to make it easier to compare and save.