Car Insurance in New South Wales: A Comprehensive Guide

This report provides a comprehensive overview of car insurance in New South Wales, covering its importance, types, policies, and legal framework. It explores the need for insurance in a state with high accident rates and theft statistics, highlighting the benefits of protecting assets and mitigating financial risks. The report also delves into the different types of car insurance available, including compulsory third party (CTP), comprehensive, third party property, and third party fire and theft, outlining their coverage and benefits. Additionally, it examines the policies and regulations governing car insurance in NSW, emphasizing the mandatory nature of CTP and the factors influencing insurance premiums. The report concludes by emphasizing the importance of car insurance in NSW, urging drivers to understand their options and choose the right coverage for their needs.

Car Insurance NSW
1

Contents
Introduction......................................................................................................................................3
Insurance..........................................................................................................................................4
Laws of NSW..................................................................................................................................7
Importance of Insurance..................................................................................................................8
Need of insurance............................................................................................................................9
Types of insurance.........................................................................................................................10
Policies...........................................................................................................................................11
Conclusion.....................................................................................................................................12
Bibliography..................................................................................................................................13
2

Introduction
Insurance is mandatory in the New South Wales for taking the coverage of cars for the long term.
This helps in protecting the cars from the damages and losses that occur due to the accidents and
thefts that take place in New South Wales. The needs of the insurance will also be explained in
the report. The importance of insurance in the New South Wales has been discussed in the report
that helps in protecting the assets and property for a long term. The policies of the car insurance
have been adopted by the government for making the drivers of New South Wales to reduce the
number of risks and damages that take place due to crowded roads. The drivers need to take the
coverage for cars and damages that accrue in the cars. Different types of insurance have also
been explained in the report. The needs of insurance are made in the following report. The
conclusion of the entire report has been discussed in the further report.
3

Insurance
Insurance refers to a contract or policy represented for financial protection to the individual or
reimbursement of any losses occurred by the insurance companies. It is basically drawn to
transfer the risks by compensating the insured person for the damages and loss that occurred to
Assets or life. Their aim is to make the clients afford the risks by providing then financial
assistance. The traffic and dodging potholes in the Sydney makes the NSW people insure their
vehicle especially cars. For saving the life and cars from the crashes due to the conditions of the
cars it is required to the insure the car and make the payments for any damage that takes place.
The insurance of car requires the third party, as it consists of the legal requirement for insuring
the car. It acts as the comprehensive coverage of the damages or loss that arises due to fire, theft
or storm. It also considers the cover of the third party for the loss that arises at your fault. This
loss needs to be paid by the owner himself (Siaminamini, Naderpour, & Lu, 2017).
State % proportion of
claims
4

New South Wales/ACT 32.89%
Victoria 30.06%
Queensland 18.83%
South Australia 9.02%
Western Australia 8.31%
Tasmania 0.71%
Northern Territories 0.18%
Source: (Allianz, 2018)
Car insurance has been mandatory for the drivers in New South Wales for protecting their cars
and life. This helps them in compensating the damage that accrues to them due to the harsh roads
and path holes. The above graph denotes the number of people that claim for the insurance of
their cars. Around 32.89% people in NSW claim for the car insurance. This has been increasing
and stands at highest peak during the last 3 years.
5

Source: (Research, 2016)
The above graphical presentation depicts the number of people those who have availed the
facility of insurance. Around 83% people are in need and take the insurance car and 77% has
taken the home insurance. The rate of car insurance is highest due to the condition and threat the
people have regarding their cars and roads and traffic of the country.
6

Laws of NSW
Motor Accident Injuries Regulation 2017- This act has been taken into consideration for the
unregistered vehicles subjected to permission. This acts the insurance availed to the third party
for protecting the assets from loss or damage.
Road Transport Act 2013 No 18- this act has been covered in under the section of 45C of the
interpretation act 1987. This has been developed for protecting the people from the road
accidents that arises large level due to the crowded road of New South Wales.
Motor Dealers and Repairers Act 2013 No 107- This act is meant for the protection of
consumers in New South Wales. This helps in providing the transparency between the dealers
and the consumers. This also provided guidance and protection of the dealers or motor vehicles
for any misconduct or unfair practices.
Australian Road Rules- This act has been covered under clause 6 of New South Wales for road
safety. The act that carries is Road Transport Regulation 1999.
7

Importance of Insurance
Insurance is important as it helps in providing the coverage to assets and reduces the liability. It
helps in driving the way with legal protection. The insurance is required to protect the property
and assets by availing it with a coverage for any loss or damage that would be faced in future.
The drivers had to pay a high premium for availing the services of cars and its insurance. The
amount of insurance differs from state to state and country to country. This makes the difference
in the liability of the drivers that they need to bear for availing the insurance facility of cars. It
also helps in availing the facility of safety and security and legally obliges the rules and
regulations of the government. It also helps in mitigating the risks and help in resolving them
instantly. It provides the protection to the vehicles so that the drivers can drive their cars
smoothly on the roads of NSW and Australia. It also helps in providing the long-term financial
resource to the individuals and helps in promoting the growth in the economy (Weisburd, 2015).
The insurance of the vehicles reduces the burden and stress level of people by getting the amount
of compensation for any damages that have been accrued to the life of the individual or the
assets. The growth in the insurance sector leads to diminish the probability of risks and lead to
increase in the growth of the economy. It also helps in mitigating and spreading the risks from
the insured to the insurer. It majorly focuses on spreading the risk to a large number of people so
that it can help in reducing the burden from a single individual. The large amount has been
received from the number of people who avail the policies of insurance that is used for the
damage accrued to the individual. This makes the individual repair the vehicle as well as
compensatory amount availed for the theft and loss of cars of vehicles in NSW. The car
insurance in NSW protects the insurer from the damages that took place due to fire, storm or
theft. It acts as the comprehensive cover which compensates for the life of the insurer and others
(Maggio & Kermani, 2016).
8

Need of insurance
Insurance is required for protecting the vehicles and events from the damage by availing the
financial assistance. It also provides coverage for the injuries to the people and drivers,
pedestrians, property etc. It is important for availing the coverage for the accidents by getting the
financial assistance. The financial help is required by the drivers for that insurance to the cars
and property is required. Car insurance is needed in NSW for protecting the cars and vehicles
from the losses and damages that accrue to their property and assets. It also covers the expenses
that take place in the life of driver or passengers due to the accidents and damages that lead due
to the cars. It also helps in providing the financial support to the cases like theft, fire or storm
(Baker & Logue, 2017).
The insurance is needed to keep the individual stress and burden free. This also helps in
providing the long-term security to the assets and lives of people. This protects the assets from
the losses and theft take took place due to the negligence. It acts the as coverage took for the
drivers in NSW for reimbursing their amount of losses or theft they face due to damage in cars. It
is a legal obligation of the individual to the make the insurance car and avails its coverage and
protection. The insurance is required by the individual for not paying any penalties to the
government of NSW for the loss or damage took place due to accidents and thefts. The
government or policies can seize the car or any other vehicles that are driven without the
coverage of insurance. This makes it follow the guidelines of the government of NSW and take
the coverage for the car by taking insurance (Poulos, Hatfield, Rissel, & Flack, 2017).
9

Types of insurance
Different types of insurance have been developed in New South Wales so that it would help in
protecting the assets. This helps in protecting the cars and assets from damage or loss that take
place due to accidents, theft or fire. The types of insurance are-
Compulsory third party (CTP)- It is known as a Green slip in New South Wales which need to
be adhered by the drivers in the state. This has been different in states and territories for
protecting the person regarding the injury and driving the vehicle. This form of insurance is
required by every driver after the registration of car in the all the states and territories.
Comprehensive- this insurance covers the loss replacement or repair cost of the vehicle that is
damaged due to accidents, collision, theft or malicious damage. It is quite a competitive car
insurance which provides a good range of inclusions.
Third party property- This types of insurance help in availing the compensation to the third party
due to the accident caused by your vehicle. This does not provide reimbursement to the vehicle
of the owner.
Third party fire and theft- This insurance acts as the additional benefit for the third party by
providing protection to their policies. This also helps the coverage for the fire and theft to the
vehicle of the owner (Banks & Bowman, 2017).
10

Policies
The policies are meant to be developed or implemented in the NSW for providing the car
insurance facility to the individuals. New South Wales is the most expensive state in Australia
for availing the insurance facility of the car. The rate of accidents in the NSW is high, this made
it garb the facility of insurance by the drivers in the NSW. The theft rates of the country are also
very high that made the people to adopt the car insurance for protecting their cars from any
damage or theft. The crowded roads of the New South Wales are the main reason for the
accidents and increasing rates of insurance claims (Douglas & Bath, 2017).
The policy of CTP also known as the green slip is mandatory for availing the facility of car
insurance as it covers the injuries cost that arises in the road accidents. There are six CTP consist
in New South Wales that have different price and values which need to choose by the driver. The
stamp duty of car insurance is fixed at 5% in New South Wales. The driver has an opportunity
for adopting the car insurance policy of either 6 or 12 months for compensating the cost incurred.
The cover would be provided to the individual at equal rate and value for protecting the car and
life. The cheapest green slips need to acquire by the individual for availing the facility of
insurance (Hayward, Christensen, & Gay, 2018). The consideration need be made while deciding
the types of insurance are-
 The types of insurance are required for the vehicle.
 Any additional benefits are required by the rental vehicles.
 Insurance is required for market value and actual value.
 The accident will avail any claim.
 The need for paying any excess for nominating the responsibility of the driver.
11

Conclusion
From the above report, it is concluded the New south wale have been the most expensive state in
Australia that has more the average rate of theft. The crowded roads and increasing rate of theft
made an increment in the car insurance facilities provided to the people in the New South Wale.
The importance of the car insurance has been explained in the above report as well the needs for
protecting the assets have been described in the report. It has been considered as illegal to drive
the car in New south wale without the coverage or insurance. The laws and policies made by the
government for protecting the people regarding the accidents, theft and losses have been covered
in the above report. The different types of insurance have also been taken into consideration.
12

Bibliography
Allianz. (2018). (Allianz) Retrieved April 5, 2018, from Find out how much Life cover you may
need in just a few minutes!: https://www.allianz.com.au/life-insurance/life-insurance-calculator/
Baker, T., & Logue, K. D. (2017). Insurance law and policy: cases and materials.
Banks, M., & Bowman, D. (2017). Juggling risks: insurance in households struggling with
financial insecurity.
Douglas, M., & Bath, V. (2017). A New Approach to Service Outside the Jurisdiction and
Outside Australia under the Uniform Civil Procedure Rules.
Hayward, G., Christensen, S. T., & Gay, C. E. (2018). U.S. Patent No. 9,865,020. Washington,
DC: U.S.
Maggio, M. D., & Kermani, A. (2016). The importance of unemployment insurance as an
automatic stabilizer.
Poulos, R. G., Hatfield, J., Rissel, C., & Flack, L. K. (2017). Near miss experiences of transport
and recreational cyclists in New South Wales, Australia. 101, 143-153.
Research, C. (2016). Where do the most accident-prone drivers live? Retrieved April 5, 2018,
from Canstar: https://www.canstar.com.au/car-insurance/worst-drivers/
Siaminamini, M., Naderpour, M., & Lu, J. (2017). Generating a Risk Profile for Car Insurance
Policyholders: A Deep Learning Conceptual Model.
Weisburd, S. (2015). Identifying moral hazard in car insurance contracts. 301-313.
13