Buying a car doesn’t stop as soon as you drive away from the dealership - you need to protect your investment. People make mistakes and accidents can happen any time of the day. With car insurance, you’re protected from having to fork out thousands of dollars to fix any damages to yours or someone else’s car or even property like fences.
Here we’ve pulled together everything you need to know with our guide to car insurance in New Zealand, so you can drive with confidence that should something happen you have the right cover for your situation.
Choosing an Insurance Provider
With the number of insurance companies out there, finding the right one to suit your needs is the first step to getting your vehicle insured. Start by doing some research, shop around and put together a list of all the insurance providers.
Talk to your family and friends to find out which insurance company they’re with - why they chose them, what the benefits are and if they offer a good price.
Ask the dealership you are buying the car from if the manufacturer offers insurance plans such as Suzuki Insurance. If you are financing the car, you may be able to include the cost of insurance within your regular finance payments.
Narrow down your list to at least 3 providers you like. Don’t pick based solely on price. Check out their various policies, the features they include, and request a quote.
See if any offer discounts for bundling your home and contents with them, and check out the terms and conditions so that you’re fully aware of what you’re paying for.
Types of Car Insurance Policies
Comprehensive Car Insurance
A comprehensive policy covers your car if it gets stolen or damaged in an accident and pays out whoever’s car or property might have been affected by your car - with add-ons like roadside assistance. This is generally the most expensive option as it pays out for the widest range of situations.
Under Suzuki’s comprehensive motor vehicle insurance, your new car will be replaced with a brand new vehicle of the same kind, if it is stolen or damaged beyond repair during the first 3 years. If it is able to be repaired, then only genuine Suzuki parts are used in the process, ensuring your car continues to meet any warranty conditions and stays in perfect running order.
Third Party Car Insurance
With a third party policy, your provider will settle a payout for the car or property damaged by you - except for your car. Effectively, if your car is stolen or gets into an accident where you are at fault, you’ll have to pay out of your own pocket to fix or replace it.
If someone else hits your car and admits it was their fault, their insurance provider should cover the cost of repairs to your car if you have third party insurance. If the person who admitted fault doesn’t have insurance, then your insurer may chase compensation on your behalf in some cases.
Third Party, Fire & Theft Car Insurance
A third party, fire & theft policy is very similar to third party insurance with a bonus that you’ll be able to make a claim if your car is stolen or catches on fire.
Add-ons:
As well as standard comprehensive policies, you can buy extra cover, e.g. roadside assistance, no excess for replacing a damaged windscreen. Before adding extra costs to your premium, ask yourself if they're in your budget and if you really need added protection.
Types of Additional Insurance Policies For Your Car
Mechanical Breakdown Insurance
Mechanical breakdown insurance is suitable if your car is no longer covered by the manufacturer's warranty. It covers the potentially expensive costs of sudden and unforeseen mechanical or electrical breakdowns.
Payment Protection Insurance
If you are financing your car, then payment protection insurance can cover payments for certain situations such as disablement, hospitalisation, or redundancy and if you are diagnosed with a terminal illness or die, then the outstanding amount is paid.
Guaranteed Asset Protection
The value of your car insurance payout may be significantly less than the outstanding balance of an existing credit contract on your car. With guaranteed asset protection, you can select cover of between $5,000-$20,000 to cover the shortfall.
Conditions of Car Insurance
Car insurance policies come with a whole bunch of strict guidelines and conditions to abide by, so that you are eligible to make a claim. You really don’t want to be paying a monthly premium for your insurance, only to not be able to reap its benefits.
Here are a few conditions you need to follow for your policy to be valid:
- A valid driver’s license.
- Your vehicle meets safe and road-legal conditions.
- The person driving isn’t under the influence of drugs or alcohol.
- Truthful answers about the car’s condition and modifications, driving history, whether your car is used for business purposes and if the person behind the wheel is insured under your insurance agreement.
How Much Does Car Insurance Cost?
It’s tough to put a concrete figure on how much car insurance will cost you. There are a number of factors that your insurance provider will look at to determine your risk of having an accident.
Here are a few factors that affect the price of your insurance policy:
- Age – you'll pay a higher premium for drivers who are under 25 or who don't have a full licence. The risk can also increase the older you get.
- Car accident history – a clean driver’s license and not making claims makes a big difference how much you pay.
- Car make, model and year – the more technology in vehicles such as sensors in bumpers, the higher the cost of the repair, so insurance rates increase.
- How secure your car is – is your car stored in a locked garage or does it have an alarm.
- Where you live – living in a big city increases the risk of an accident as opposed to a small town where there is less traffic.
- If your car is for personal or work use – premiums increase for work vehicles and if your work is to transport people or goods, then it increases again.
- Number of people you’re looking to cover on your policy
Types of Insurance Cover
Market Value – It’s the value your car is insured for based on the market’s valuation right before an accident.
Agreed Value – This is the value your car is insured for based on the agreement between you and your insurance provider when you took out the policy and every time you renew it.
What is Excess?
Your excess is the agreed amount that you have to pay if your car gets damaged or if you damage someone’s car. This money goes towards the costs of the damage with your insurance provider covering the rest of the cost on your behalf. Apart from some windscreen cover, you will pay an excess no matter which policy or cover type you have.
You can choose how much excess to pay when you set up your policy, and increasing the excess does lower your premium. However, it pays to think about how easy it would be to pay for the higher amount in one go at the time.
What To Do if You Are Involved in an Accident?
- Stop the car. Make sure you or anyone else involved is unhurt then move the car off the road to a safer position if able to.
- Phone emergency services especially if someone’s been injured.
- It’s important to get the name, contact number, car registration number and insurance company of the other driver involved.
- If the other party is not insured, note down the make, model, colour and registration number of their car. If possible it is a good idea to see their driver’s license details as well.
- Exchange your details with the other driver.
- Write down all the details of what happened and where the accident occured while they are fresh in your mind. Taking photos is another good way of recording details, especially road signs and markings, damage to the vehicles, and a copy of the registration in the car window.
- If there is a police officer at the scene, get their name and ID number so that you can refer to them in your insurance claims.
- If there are any witnesses around, note down their contact details so they can help to corroborate your story.
- Depending on your cover and the state of your vehicle, your insurance provider may arrange for it to be dropped off and picked up so it can be assessed and repaired.
- There may be other terms and conditions depending on the insurance provider, so check if there is anything specific required from you after an accident.
Finding the right insurance provider and policy can be hard work, especially with all the jargon - but having a plan in place will mean you are better prepared to deal with it if the unthinkable happens.
If you’re on the hunt for a new car, but not sure where to start or what to look for in one, download our Complete Guide to Buying a New Car today!
