Choose Your Car Insurance Provider Carefully in Australia

Friday, 21 August 2015

In this era of packaging, presentation and hype, anything and everything that is sold in the market is promoted by highlighting its virtues and hiding its vices, so to speak. As you try to shortlist a car insurance provider you need to bear this in mind. Typically, most Australian car insurance companies may have tie-ups with low-bidding smash repair companies. The damaged cars are sent to these companies, who in turn ‘fix’ them using cheap and poor quality spare parts and mediocre service. Therefore, while looking at the benefits of a car insurance provider, it is important to verify whether the “claims” that your insurance provider sells you, holds true at the actual time of your smash repair claim.

You must have a very clear idea of the damages that the car insurance policy covers. It could be comprehensive or limited and you need to choose the one that matches your needs the most. While choosing a car insurance service provider, do extensive homework and have a basic understanding of the options available in the market. Of course, you can do this online but before you begin the task, do make a personal check list of the points that you want covered. This helps you to identify the companies that fulfil your insurance needs. Once a few have been outlined, simply compare their premium rates and the flexibility of payment plans.

The cheapest car insurance is not always the best. In the event of a claim, your cheap annual premium may mean that you will receive less quality repairs, or take more of your time to organise claims. On the same note, with the right insurer you may be eligible for a discount such as No-Claim-Bonus which will assist in an affordable annual premium.

A comparison should also be made in terms of the extra benefits that each of the shortlisted companies offers. There are companies that provide discounted car hire service or a towing service in case of accidental repairs and valet service in the event of breakdown or accident on the move. Though, such perks are intended to pull more customers, they do matter if and when required – you may actually need them on real time basis and their total cost adds up to a reasonable value that you would other wise have to pay from your own pocket.

You should of course read the Product Disclosure Statement provided by your insurer very carefully before entering into a policy with them. The PDS can usually be found on their website, and they can send one to you if you ask.

As you prepare your checklist of the things that you need in a car insurance policy, here are some of the typical aspects that must be taken care of:

COVER

  • Is it comprehensive? 1st party or 3rd party?
  • Extent of liability (excess) by causing damage to a 3rd party property
  • Extent of cover in the event of theft and/or misuse

CLAIMS

  • Parts & components of the vehicle covered in case of accident – These are some points that are often disclosed at the very end when the estimates are handed over for signing and you realise that you will be paying for parts like the dashboard or windscreen.
  • Quality of repairs – This is determined by the associated accident repair centres and guarantee on the parts replaced.
  • Choice of Smash Repairer – in a PDS, the insurer will identify whether you have any choice about where your vehicle is repaired, and the extent to which they can require you to go somewhere. By law, if the insurer agrees to give you choice, they must abide by that agreement. If you want freedom of choice, you must ensure that you are not locked in to the insurer’s network of possible low-quality smash repairers.

AGREEMENT

  • Though most of the information is available on the website of the company, make it a point to interact with a representative and verify all claims made in the brochures and website. Ask them what would happen if you were to make a claim 6 months from now, what you would need to do, and confirm with them that you are able to choose your quality smash repairer. Remember though that they are bound by what is written in their PDS.
  • Ensure that all that is claimed in the promotional material will be delivered, by having it in the written agreement signed by the insurance company.
  • Beware of the hidden costs & things mentioned in the small print in the agreement

All said and done, your instinct in judging people & situations is an intangible but indispensable requisite and trait for choosing your car insurance provider.