A record number of motor vehicle thefts were recorded in the year to June 2025. Here are practical ways to help keep your car secure at home and on the street.
Motoring
How to choose the right car insurance policy
Choosing the right car insurance policy is an important decision for Victorian drivers.
Selecting a car insurance policy that fits you depends on your personal circumstances, including the value of your car, your budget, and your risk tolerance.
How to choose the right car insurance policy
Choose the right coverage level
Before comparing policies, it's essential to understand the four main types of car insurance available in Victoria. Selecting the right level of cover depends largely on your vehicle's value and how much financial risk you are prepared to take on.
Compulsory Third Party (CTP) car insurance is mandatory for all registered vehicles in Victoria. It's included in your vehicle registration and covers injuries to people if you cause an accident. However, it doesn't cover damage to vehicles or property.
Third Party Property Damage car insurance covers damage you cause to other people's vehicles or property, but not damage to your own car. This level of car insurance may be appropriate for older or lower-value vehicles, as it protects you from the potentially high cost of damaging someone else's property without covering your own car.
Third Party, Fire and Theft car insurance extends the same protection as third party property damage, but with added cover if your car is stolen or damaged by fire, offering limited protection for your vehicle while helping keep premiums lower than comprehensive car insurance.
Comprehensive car insurance offers the broadest protection and is often suitable for newer cars or vehicles that would be expensive to repair or replace. It typically includes damage to your own car, damage you cause to others, theft, fire, vandalism, weather-related events, and often additional benefits such as hire car cover.
RACV Car Insurance also offers Complete Care® car insurance, which builds on the inclusions of Comprehensive Insurance, with extra benefits and premium features.
Understanding these options is the first step in choosing the right car insurance policy for your circumstances.
Newer or more expensive cars may be better protected with comprehensive car insurance.
Consider your vehicle's value and age
Your car's value plays a major role in determining the level of cover you need. New, high-value, or finance-backed vehicles are generally best protected with comprehensive car insurance. This helps ensure you are covered for repair or replacement costs if your car is damaged or written off.
For older vehicles with a lower market value, comprehensive insurance may not always be cost-effective. In these cases, third party property damage insurance can provide essential financial protection if you cause an accident, without the higher premium associated with comprehensive cover.
Victorian drivers should also consider whether an agreed value or market value policy is more suitable, particularly for cars that may depreciate quickly.
Assess your driving habits and location
Where and how you drive in Victoria can influence the type of car insurance you choose. Drivers who regularly commute in busy areas such as Melbourne's CBD or inner suburbs may face a higher risk of minor collisions, making comprehensive cover more appealing.
If you mainly drive in regional Victoria or use your car infrequently, a lower level of cover may be sufficient.
Damage from hail is often covered by comprehensive car insurance policies. Image: Getty
Compare premiums, excess, and policy features
Price is important, but it shouldn't be the only factor when choosing car insurance. When comparing policies, Victorian drivers should look closely at:
- Premiums - the regular payments you make for cover
- Excess - the amount you pay if you make a claim
- Inclusions and exclusions - such as cover for windscreen damage, floods, or bushfires
- Optional extras - such as hire car cover.
A cheaper policy may come with a higher excess or fewer benefits, which could cost more in the long run if you need to make a claim.
Compare insurance providers
When comparing car insurance providers, it's important to look beyond the headline premium. While price is a key consideration, the level of cover, inclusions, exclusions, and quality of customer support can vary significantly between insurers.
Victorian drivers should consider whether an insurer offers local support, clear claims processes, and assistance when and where it is needed. Checking customer reviews, claims satisfaction ratings, and insurer reputation can provide insight into how a provider performs when a claim is made.
Understand policy terms, conditions and exclusions
Before taking out a car insurance policy, it's vital to read and understand the Product Disclosure Statement (PDS). This document explains what's covered, what's excluded, and any limits or conditions that apply.
Pay close attention to exclusions, excess amounts, and any special conditions relating to drivers, usage, or modifications. Understanding these details in advance can help avoid unexpected costs and ensure you know exactly what to expect if you need to make a claim.
The information provided is general advice only. Before making any decisions please consider your own circumstances and the Product Disclosure Statement and Target Market Determinations. For copies, visit racv.com.au. As distributor, RACV Insurance Services Pty Ltd AFS Licence No. 230039 receives commission for each policy sold or renewed. Product(s) issued by Insurance Manufacturers of Australia Pty Ltd ABN 93 004 208 084 AFS Licence No. 227678.
