Taking out car insurance for the first time can feel a little overwhelming. From determining how much cover you need to wrapping your head around new terminology, there’s a lot to take in before you even get to signing the dotted line.
Don't let yourself get flustered trying to navigate the world of car insurance. We've put together this quick guide to help you select the best possible policy for you and your car.
Understand the different types of Car Insurance
It's never one size fits all when it comes to car insurance, which is why you'll discover there are varying levels of cover depending on what you need.
When you're weighing up which type of car insurance is best for you, consider the financial loss you'd face if your car was totalled. For example, if you have an old car on the verge of its lifespan that would cost more money to fix than to replace, you may opt for less coverage than if your car were brand new.
Comprehensive Car Insurance - At Youi, this covers everything from theft, fire, accidents, vandalism, storms, floods, earthquakes. It also includes towing, storage costs and a hire car if yours is stolen.
Third Party Fire & Theft Car Insurance - If top level cover isn't for you, Third Party Fire & Theft may be the solution. This covers you for damage as a result of theft, fire or earthquakes. At Youi, we also cover your towing costs and any contents that were damaged or lost inside the car. If the incident happens when you're away from home, we'll also the cost of emergency accommodation and transport.
Third Party Property Only - If you're a casual driver or have a car that's on its way out, you may decide Third Party Property Only is the way to go. This is an entry-level policy that, at Youi, covers you for up to $20 million in legal liability if your car causes damage to someone else's property. It also covers you for up to $5000 in repairs if your car is damaged by an uninsured driver.
Understand Common Car Insurance Terms
While you're shopping around for car insurance, you're sure to come across some new terms that are essential in understanding what your policy covers you for. We've listed some of the most common ones below, but you can find the complete list here.
Agreed value - The amount shown on your policy schedule, which we agree to insure the car for at the time of loss. The agreed value includes any after factory or non-standard accessories that may be fitted to the car.
Contract period - The period, including the time and date, from the start or renewal of your policy to its expiry.
Excess - The first amount you must pay in relation to each and every claim made under your policy.
Insured event - An event for which you can make a claim under your policy.
Insured value - Either the market or agreed value as shown on your policy schedule.
Market value - The reasonable and expected cost of replacing the car with a car of the same or a similar make, model, mileage and condition before an insured event for which you claim. Market value does not include any warranty costs, future stamp duty, transfer fees or allowance for dealer profit. Market value includes an allowance for after factory or non-standard accessories up to the amount noted on your policy schedule for After Market Accessories.
Total loss - When the insured car is damaged to the extent that we decide it is not economical or safe to repair, or it is stolen and not recovered.
Revisit Your Car Insurance Needs Often
You may want to breathe a sigh of relief once you've taken out your first car insurance policy, but don't get too comfortable. Your car insurance policy should be revisited often to ensure you maintain the best level of coverage, and the best premium, when your circumstances change.
For example, if you buy a house, start a new job or change the way you use your car (i.e. you start commuting or working from home) then you should notify your car insurer straight away to see how these changes will affect your premium. Down the road you may even decide to buy a new car, in which case you'll need to switch your current car insurance cover over - and revisit your needs at that time.
Ready to take out your first car insurance policy? Start a quote with us to see how much you could save.