Hi Everybody,
Looking at buying a used car, and standing costs aren't cheap.
Thinking of either getting a 2012-2013 Toyota Corolla (for approx $12,000) and getting a higher excess on full comprehensive insurance.
OR, buying an older Corolla (mayber circa 2005-2007) for $5,000, and getting only 3rd party insurance.
Looking to use it for approximately 5 years before selling.
Does anyone here use only 3rd party, and what is the approximate value of their car?
Thanks.
This is also my experience.
Our $6000 insured value car was $80 more p.a. for comprehensive with a $800 excess than 3rd party alone.
It wouldn't take much to write off a $6k car, so worth it for us, even though we intended to self insure.
not sure if diff between states
but qld … just car ins, racq ins, coles ins,
3rd party only $200 pa
are you saying everyone can get comprehensively insured at $300 pa ?
Similar experience here..
Where is Comprehensive Insurance even just double that of 3rd party?
The difference on my vehicle is more like 400%!
I figure the sweet spot to transition (assuming you can afford to buy a replacement at a moment's notice) is around $5000 residual value.
By then Insurance Premiums (plus excess) are into the realm of being 25-30% the value of your car. And if you had to, replacing the car out of your own pocket isn't that much of a stretch.
I'm in a good enough financial position that I can afford to write off and replace the car should it come to it. I've driven for 25 years with no claims, so feel my risks of an at fault crash are low and Comprehensive Premiums would sum up to more than the value of the vehicle within 5 years.
Every year I stay clean is another ~$500 towards the replacement vehicle. We're $1500 toward that goal, touch wood!
I have heard that some 3rd party insurers are taken advantage of from full comp insurance claimants when a claim is made.
The reason being is this; even if you are not at fault if you are involved in an accident, the "at fault" drivers full comp insurance (if it is another company) realises that you have 3rd party, they stuff you around in paying you out as they know that you won't be represented by your insurance if you have to claim. Then you are running around trying to get your payment without a car if it is written off.
What happens if you are hit by a truck (god forbid), your car is written off and the truck has a scratch. The driver decides to take his time to claim? You do have up to 6 years to lodge a claim. You need a car right away? You have no full comp. Will your insurance bat for you?
You have to read the PDS as some insurance companies do pay out up to $5K if the other party is at fault even if you have 3rd Party. Obviously you have to get particular details, licence, reg etc and they admit the fault.
Get quotes for both 3rd party and full comp and see if there is a massive difference.
Sometimes it's just worth to go full comp as it will save headaches in future.
But that is my view.
Cheers
We are in a similar position in that we could easily cover the cost of getting a new car for ourselves but are worried about going down the 3rd Party only path as it will probably make it a lot more expensive to go back to comprehensive insurance when we get a new car. Wondering what people's views are on this?
Wont be a problem if you have a second vehicle comprehensively insured.
Only have one vehicle.
Would have no bearing
Thanks for the reply. So we won't have to pay more because we have had a break from comprehensive insurance, we will be able to go back on the rate as we left it with no penalty? Does this apply to all insurance companies?
Some companies might have the smallest price increase for not having continous insurance by their actuaries. The reasons are bonkers but they can do it.
This is more than offset by shopping around for insurance every year and NEVER accepting a renewal letter.
@pao2x: We do shop around, but good advice. Will look further into this as our car is only worth a few thousand dollars now as a right off.
I've always had third party in order to protect myself against crashing into a Ferrari.
I am however on a motorcycle where third party is under $100, and comprehensive is pushing close to the 4 figures range because I'm under 25.
With a car, I guess it depends on your personal circumstances. Have you crashed before? Will bad drivers be driving your car? If so then probs go the more expensive option.
You'll just need to weigh up both case scenarios ($5000 for a corolla + $2500 (5 years of third party @ $500 a year) - $2500 approx sell value = -$5000).
This is just a rough guide but do that for both, work out how much more/less each option will cost you and make a decision from there.
Either way, cars are super expensive. A corolla is definitely the way to go though.
The only thing I disagree with is that Corolla is the way to go.
The premium you pay for those things is ridiculous, there are so many great, reliable cars in this market segment, you pretty much can't go wrong and going anything else gets you a newer, lower Km vehicle.
Thanks.
That's exactly the way we're looking at it.
Will do the maths over 5 years for both options.
I didn't consider the stuffing around if the other driver doesn't want to pay up, etc.
Bought my parents 3rd party on a 02 Focus - that was insured at about 5k.
Renewal came in and after speaking with AAMI - turns out it was about 15$ per month cheaper to have comprehensive.
You should consider the value in comprehensive insurance compared to third party property damage, which to me is as follows:-
I made my first insurance claim under my comprehensive policy for a not-at-fault accident about 18 months ago and I was surprised at just how effortless it was. I made a single 15-20 minute call to the insurer and within about 2 hours my car was towed from the scene of the accident, I was dropped off at a hire car agency, and had a hire car waiting for me, at no outlay to me. Then a fortnight later I drop off the hire car and collect my repaired car. Easy peasy.
I can understand why you wouldn't have comprehensive on a $1000 beater or for a cheap-ish car that gets driven infrequently but in nearly any other situation I think it's worth spending the extra. I have two old cars worth about $5000 each and I have comprehensive on both.
Thanks.
Looking to see what decision others take and what risk they're willing to take.
Appreciate your input.
what is difference in premium?
recent policy of our $5000 car - 3rd party only was only a hundred or so less per year for a lot less coverage.