How much is car insurance?

On average, Aussies are paying $1,131 for their car insurance. However, that number varies depending on multiple factors. 

We can’t give you an exact number on how much your car insurance will cost, because it depends. Insurance rates are based on factors such as your age, location, driving history, car, additional coverage and a few other components. 

If you’re wondering about the average cost of car insurance in Australia, you’re looking at $1,131 per year according to Mozo.

Average car insurance cost by state

In every Australian state, driving without insurance is illegal. Prices vary by state as some states may file more claims on average, making premiums more expensive. If your state is more populated or has a higher crime rate, you’d also be looking at higher premiums.

  Source: Canstar, 2019

The average cost of car insurance by coverage type

Specific coverage that is added to your policy contributes to your total premium. For example, having compulsory third party coverage increases your premium. However, that also means you are protected if someone is injured in an accident.

Additionally, additional coverage such as comprehensive insurance is pricier, however, you’d be fully covered. Comprehensive coverage is the most advanced form of coverage. Other types of insurance coverage include third-party property damage and third party fire and theft coverage. Third-party property damage covers you if the damage is caused to someone’s property. Third-party fire and theft cover you if damage such as a fire of theft is done to your car.  

Let’s give you some average figures on each coverage annually.

What determines the cost of my car insurance?

Multiple components contribute to your car insurance premium. That’s why it’s difficult giving an exact figure without knowing your information. Additionally, each insurance organisation has its own set of factors that help them determine your premium.

Let’s breakdown some of the most common factors that determine your premium:

Your driving history

As you can imagine, car insurance companies will look at your driving history (usually the last 5 years) to determine your rate. If you’ve previously been in an accident, your premium will be higher. That’s because your car insurance provider will see you as a higher risk of filing a claim. Therefore, if you haven’t been in a car accident, you are less of a risk, meaning you could find lower rates.

Essentially, lower risks mean lower rates while higher risks mean higher rates.

The type of coverage you purchase

As mentioned previously, additional coverage results in additional prices. Refer to the table presented above to get a rough estimate of how much each coverage costs per month.

Age

Unfortunately, drivers under the age of 25 in Australia are seen as being a higher risk by insurance companies. Your experience on the road determines the likelihood of you getting in a car accident, which is what car insurance companies look at. Therefore, if you’re still a P plater, unfortunately, your premiums will be much higher than a middle-aged driver for example.

How often you’ll drive

Car insurance companies consider more time on the road as more likelihood of getting in a crash. Inputting a bigger amount of time driving when applying for insurance will increase your premium.

Location

Some suburbs or states may be perceived as higher risks than others. Car insurance companies look at statistics to determine the possibility of your car being vandalised or stolen, and therefore either increase or decrease your premium.

Does filing a claim increase my premium?

Yes, filing a claim will increase your following premium. That’s because your insurance provider will see you as a higher risk. That’s why some people may not file claims if an accident wasn’t too bad.