Car insurance claims: What’s the pay-off?

By Olivia Gee ·
Family after a car accident calling to claim insurance

Most drivers will take out car insurance to protect their vehicle and finances in the event of an accident or emergency.

So, while you want to make sure you’re getting a good value deal on your premium, you should also know what kind of payout you’ll get if you need to make a claim.

The Australian Prudential Regulation Authority’s (APRA) most recent data on car insurance claims shows the average payout in 2019 was $3,362. This excludes claims made under CTP insurance, but covers all voluntary domestic motor vehicle insurance claims, from third party car insurance claims to cover under comprehensive policies.

If APRA only assessed comprehensive policies, it’s likely this number would be much higher. This is because third party cover only insures drivers for a limited amount of damage they cause to other people’s cars and property (often only up to $5,000 as standard) and not to their own.

Is it worth making a claim on car insurance?

In most scenarios, yes. Whether it’s cover for repairs and towing for your own wheels or for damages to other cars, costs can stack up and you don’t want to be left with a bill or no ride.

However, some minor cosmetic damages might not be worth covering through insurance because of your excess (the amount you pay before your insurance kicks-in). 

Say you’ve got an excess of $800 and you ding the front of your car on a cement wall. Paying a mechanic to iron out the dent and do a minor paint touch up may cost less than paying your excess to access insurance cover. Couple that with the risk of losing your no claims bonus, and an insurance claim is not adding up in your favour.

Some insurers approach this ‘excess versus repair cost’ conundrum by offering things like low-excess or excess-free windscreen cover. This way customers can access the most cost-effective repair route for this kind of common minor damage. 

How much should you pay for car insurance in 2020?

The average cost of a comprehensive car insurance policy in Australia is $952, according to Mozo’s 2020 Car Insurance Report.

However, this can differ considerably depending on factors like your gender, age, where you live, your driving history and even the colour of your car.

Price hikes for Australia’s youngest drivers (aged 16-20) are particularly substantial, with the average cost sitting at a whopping $1,608 if they take out their own comprehensive policy.

But prices do vary considerably between providers for all motorists. Mozo’s report found a $902 difference in comparable cover across the 10,000 car insurance quotes that were analysed.

If you want to find a policy with an affordable premium that also has generous cover, the best thing you can do is research policies thoroughly. Assess every Product Disclosure Statement (PDS) carefully and compare car insurance policies you’re considering.

Compare car insurance - page last updated October 17, 2020

Search promoted car insurance below. Advertiser disclosure.

  • Comprehensive Car Insurance

    Monthly premiums
    Calendar icon
    Yes Costs Extra
    Choice of repairer
    tools icon
    Optional Extra
    Choice of excess
    coins icon
    $500 - $1,850
    Agreed or market value
    Car coin icon
    Agreed Or Market

    Available discounts

    • Online Discount Up To 15%
      Compare
    Details
  • Comprehensive Car Insurance

    Monthly premiums
    Calendar icon
    Yes Costs Extra
    Choice of repairer
    tools icon
    No
    Choice of excess
    coins icon
    $800 - $2,000
    Agreed or market value
    Car coin icon
    Agreed

    Available discounts

    • No Claim Discount
      Compare
    Details
  • Comprehensive Car Insurance

    Monthly premiums
    Calendar icon
    Yes Costs Extra
    Choice of repairer
    tools icon
    Optional Extra
    Choice of excess
    coins icon
    $400 - $1,850 (varies By State)
    Agreed or market value
    Car coin icon
    Agreed Or Market

    Available discounts

    • No Claim Discount
      Compare
    Details
  • Price Saver Comprehensive

    Monthly premiums
    Calendar icon
    Yes Costs Extra
    Choice of repairer
    tools icon
    Optional Extra
    Choice of excess
    coins icon
    $500 - $1,850
    Agreed or market value
    Car coin icon
    Agreed Or Market

    Available discounts

    • No Claim Discount
    • Online Discount 15% Discount On First Year’s Premium When You Purchase Online
    • Restricted Drivers Discount Available
      Compare
    Details

*Any information provided on this page should be considered a summary and general advice only. All information should be verified before purchase via the relevant Product Disclosure Statement (PDS).

^See information about the Mozo Experts Choice Car Insurance Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

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Olivia Gee
Olivia Gee
Money writer

As one of Mozo’s money writers, Olivia Gee shares her research and insights across banking, insurance and property to help readers save. She loves getting stuck into a story, unveiling all the facts, breaking down stats and drawing on personal experiences - this is what drives her as a journalist. She has a double degree from the University of Wollongong, with a BA in Journalism as well as Media and Communications.