Mandatory Motor Vehicle Insurance in VIC

Slippery Otter on 22/02/2018 - 13:12
Last edited 22/02/2018 - 15:00

Should Vicroads impose a requirement for all Registration renewals to include basic third party insurance?

Just like threads popping up on here (and I myself run a panel shop in Victoria) we have issues with people causing accidents and not having insurance and sometimes our client or yourself also does not have insurance or only third party. Forking out a lot of money to fix your own car in the end.

I want you guys to vote and I like to forward this to VACC of the results. I've seen customers in tears when they find out we cannot fix their car just because the other side cannot pay for their damage. Or you take them to court, they cry poor and the best thing the judge can do is either issue judgement against them, offer a tiny settlement which barely covers the cost or offer a long term payment plan. Really?…

Poll Options

  • 1
    No, I cannot afford it
  • 2
    No, I'm a good driver so I don't need it
  • 10
    No, Why should the govenment tell me what to do!
  • 82
    Yes! Vicroads should impose mandatory third party insurance
Automotive

Comments

  • [Deactivated] on 22/02/2018 - 13:13
    +2

    Yes dumb dumb

  • dcep on 22/02/2018 - 13:37
    -2

    yes, substitute the rego fee for TPP

    • MrHyde on 22/02/2018 - 13:49
      +5

      The TAC premiums cover injuries to others - not damage to property.

    • vinni9284 on 22/02/2018 - 13:49

      The OP is referring to Mandatory 3rd Party (Fire & Theft) embedded in rego rather than going through an external Insurance company like AAMI, GIO etc.

      The insurance in rego is CTP involves covering the 3rd party for injuries and not their car.

      That way, it forces everybody to have at least 3rd party insurance for unfortunate circumstances.

      Btw, I didn't neg you :-)

    • Euphemistic on 22/02/2018 - 13:50

      I assume third party property insurance, different to the current TAC (or CTP in NSW)

    • Gronk on 22/02/2018 - 14:42

      They're different things…

      TAC premium covers your medical costs if you're injured in an accident on a public road, CTP covers you in the event your vehicle causes damage to somebody else's property.

      • Euphemistic on 22/02/2018 - 15:49

        CTP in NSW is the same as TAC in vic. The usual abbreviation for insurance to cover property damage is TPP (third party property)

    • Peter Enis on 22/02/2018 - 16:07
      +4

      This is a real concern, the number of people who confuse TAC/CTP with 3rd Party Property insurance. I wonder how many people are driving around believing they are covered for TPP when they aren't?

  • pegaxs on 22/02/2018 - 14:13
    +3

    While it is a GREAT idea in theory, and I would LOVE for it to be rolled out in every state, I could see the cost of a 3rd party property insurance slip for rego increase exponentially.

    Like what happened in NSW when they gave over control of CTP to insurance companies. I remember my rego went up from about $300 a year to almost $1000 the following year. And it was supposed to bring prices down due to competition. I feel the same would happen to compulsory 3rd party property…

    • try2bhelpful on 22/02/2018 - 15:31
      +3

      This is why it needs to be something actually regulated by the government and not some misguided "oursourcing" model to private industry.

  • Davo1111 on 22/02/2018 - 14:21
    -1

    In the end someone has to pay. Do you really think our government could do a better job than the private sector?

    • Slippery Otter on 22/02/2018 - 14:30

      If people don't want government like insurance like TAC then there should be a like a policy check when you renew your rego per year to make sure you have a valid policy with an external insurer. Basically Vicroads would have to update their website to integrate with all insurers to match your policy with your rego.

      • Davo1111 on 22/02/2018 - 14:40

        government isn't going to compete with private sector (they couldnt anyway). They'll either regulate it so they do it all, or they will keep the status quo.

        Best case is that a NFP company shows up and does a better job, creates some competition. I "believe" RAC WA does this (not 100% sure tbh)

        • Slippery Otter on 22/02/2018 - 14:51

          I'm not saying government should compete,

          One instance is Vicroads should have check in place to see if you have a valid insurance policy attached to your rego.

          That means your rego stays the same and is valid as long as you have insurance.

    • Euphemistic on 22/02/2018 - 14:36
      +1

      No, the govt couldn't do better in any compulsory system. It'll go like NSW CTP - costs way up.

    • try2bhelpful on 22/02/2018 - 15:33

      Yes I do think the Government can do a better job than Private Industry. However, by tying it to the rego and giving people the option of a tick the box at a set price then you are more likely to get take up. Let the Government negotiate with the insurance providers to drive down the price.

  • mbck on 22/02/2018 - 14:28

    Yes we all pay and the panel beater wins lol.

    • Slippery Otter on 22/02/2018 - 14:30

      If only that was the case for all private work that comes in.

      • mbck on 22/02/2018 - 14:39

        WeIll everyone will have insurance in your vision. Which means you won't have time wasters, explaining costs etc, you'll just bill the insurance. Less risk.

        This initiative will punish everyone (unfairly) when wage growth is already low.

        The only winner are panel beaters.

        • Slippery Otter on 22/02/2018 - 14:49

          90% of the time the at fault party doesn't want to pay for damages because they don't care. So if you don't have insurance or only third party. Are you going to pay for their damage caused to your vehicle? It looks like your happy to pay for their mistake to your vehicle (Should you ever be involved in an accident).

        • Euphemistic on 22/02/2018 - 15:55
          +2

          @repair-pro: no not “happy to pay for their damage to my vehicle”, but willing to take the risk that A. I won’t have a crash or B. I’ll be able to get money out of them. I’ll self insure (save money) for a low value vehicle and the risk the damage is not paid for by the other party. But I won’t self insure for TPP, I pay a premium for that.

          I base that on my driving history of very few incidents and the fact I could afford to replace, or repair cheaply my own car. $200-400 a year (diff between TPP and comp) for a $1500 car doesn’t make a lot of financial sense. It makes ore sense for a car over $10k though.

        • Slippery Otter on 22/02/2018 - 16:09

          @Euphemistic:

          (I upvoted you because you sound like a fantastic driver)

          The general population does not have the same opinion. If everyone was a fantastic driver like yourself then insurance companies wouldn't exist.

          I've also seen cars get hit in parking lots and on side streets. Somethimg people over look. Even when customers damage our hire cars.

        • Euphemistic on 22/02/2018 - 16:33
          +1

          @repair-pro: I’m aware of those parking lot incidents. Like I said, I’ll (maybe not happily) wear the cost of repairs in those situations in order to keep the costs of insurance lower. On a low value car it doesn’t matter as much if you get a cheap/self repair to keep it drivable.

          If all incidents were covered by insurance, then I believe many more repairs would need to be carried out, to a standard, which would increase premiums.

        • mbck on 22/02/2018 - 17:05

          @Euphemistic: a mature ozb, can it be?

        • mbck on 22/02/2018 - 17:07

          @repair-pro: Lol that's why there's comprehensive insurance. So that I don't have to pay the full amount. I pay an excess and that's it. I invest in a dashcam and if I can get the number plate, i'll report that to the cops and get the other driver's detail. Your example is for those who do not have insurance. Well that's their decision to not insure their asset, so it's not exactly 'unfair'.

          good luck

  • tsunamisurfer on 22/02/2018 - 14:32
    +1

    In theory compulsory third party vehicle/property damage is a good idea but the practicalities provide challenges :

    1) Cost - many are going to complain about the significant jump in vehicle rego costs.

    2) This is connected to 1). Currently our comprehensive insurance policies already have third party property built into it (and the premiums). If third party property became compulsory at a state level, would insurance companies comply with the logicalconclusion that they should reduce their premiums by the same amount we pay to the gov. I think NOT, if we are lucky we'd get a fraction of the premium off.

    • Euphemistic on 22/02/2018 - 14:38
      +2

      .3. also connected to costs: If it is compulsory and linked to rego it will be harder to get a reduced premium based on your driving history. Buy a car from a 21yo and you'll have already paid more and wont get it back. Buy a car from a low risk driver, they'll expect you to cough up extra during the changeover process.

      • Davo1111 on 22/02/2018 - 14:48
        +1

        it would be "true" insurance imo, as it would be the total cost divided by the number of vehicles on the road. Maybe it would have a car value multiplier, but i can't see it going beyond that.

        This would be great for 18 year olds, but terrible for those who have no accidents/ or have multiple cars.

        Anyway, i think we both agree it's not going to happen.

  • Butt Scratcher on 22/02/2018 - 14:55

    Poll seems bias, why does the "no" option each have a silly reason attached to it oO? While yes is all encompassing

    • Slippery Otter on 22/02/2018 - 14:56

      Please tell me what to add or change

      • Butt Scratcher on 22/02/2018 - 14:57

        Just a simple yes or no seems fine to me, or just have 1 option for "no - other" or something

        • Slippery Otter on 22/02/2018 - 15:00
          +1

          Looks like a mod has to change it

    • try2bhelpful on 22/02/2018 - 15:35

      I think we are bright enough to see this as a yes or no, without the extra wording.

      • Butt Scratcher on 22/02/2018 - 18:46

        Cool, not enough to read the first 3 words though.

        OP wants to send it off VACC, I wouldn't want my poll to seem bias if I wanted to make a convincing case. Though come to think of it, there are definitely better place to post it rather than OZB

        • try2bhelpful on 22/02/2018 - 18:57

          I agree, probably could've been better worded; however, given the response I don't think that people are being "tricked" into voting differently to what they actually think.

  • try2bhelpful on 22/02/2018 - 15:43

    The people who complain they are going to be penalised under this scheme because the premium will cover the "reckless" 18 year old as well as themselves are missing the point. At the moment the "reckless" 18 year old has no insurance and no assets to claim against when he hits your car so you are out the cost of repairing your car. Under the scheme the cost is amortized over everyone so you will pay a little bit extra to avoid trying to chase the people who won't pay for the repairs.

    If you can prove you are covered under a different insurance policy then you wouldn't need to pay.

    At least this gives people an easy option in taking out insurance, which will make it more likely it will be taken up. Tick the box and pay the amount that says Rego + Third Party Person + Third Party Property. Who wants to ring around a bunch of insurance guys and then still not be sure what you are covered for? I think this initiative would be very popular with the general population. As shown by the current response to the survey.

    • Slippery Otter on 22/02/2018 - 16:03

      I like this!

    • mbck on 22/02/2018 - 17:02

      I disagree. If I have comprehensive insurance, then i'm not exactly 'out of the cost' of repairing my car. And throwing around subjective figures definitely does not help each sides, but people will be paying more. How much more, that really depends, but there are historical increases as people have mentioned here.

      Not only that, but insurance companies are required to insure 'reckless, <18 yo, male' (not being sexist, but those factors increase your insurance premium), which definitely means increased cost to everyone.

      So while this poll is interesting, Ozb seems to have a lot of 'help I had an accident and no insurance' bunch, so this would help them a lot.

      Good conversation, but need to do some financial study to see the cost/benefit.

      • try2bhelpful on 22/02/2018 - 17:12

        Agree, it does need a cost benefit analysis done and I hope the Government actually gets off their backside and does it. Personally I would much pay a little bit more to get the reckless 18 year old insured, and him hitting me not be an issue, than have him hit me and deal with the whole world of financial pain and frustration it currently is. Under my model, if you have comprehensive insurance then you would just go with your own insurance and it will not affect you at all.

        I would also dispute that there will be a cost increase for the average insured person. If the government does their job then they can drive down the insurance costs by the increase in patronage that will occur. Yes, the 18 year old will have to actually cough up for his insurance instead of causing other people pain, but that is not a bad thing.

        I would personally have liked this scheme a few years ago. We moved house and our insurance renewal got lost in the shuffle between places. We found out when we had an accident with another guy, he had an insurance company and we didn't so we had to cop the cost of repairs even though we thought it wasn't entirely our fault. If this scheme had been in place we would've had to prove we were insured or, more likely, we would've ticked the box and been insured.

        • mbck on 22/02/2018 - 17:56

          But if you have comprehensive insurance, you'd only need to pay the excess, so regardless of there being a reckless 18 yo driver hitting you, you won't be in a world of financial pain (say 600 excess vs thousands of dollars without insurance).

          There would be an impact on even people who have comprehensive insurance, as the insurance companies are 'forced' to insure reckless drivers. This will be passed on accordingly. I also highly doubt insurance companies will not take this opportunity to do so. This happened with the first home owner grant where prices increased the same as the grant, if not more.

          I believe everyone should have some form of insurance yes. If you want peace of mind, go comprehensive. Your fault, his/her fault, you only pay the excess. Done. If you have an old car, then get third party. Your fault, his/her fault, you only pay the excess. Done. You don't want insurance? well that's the risk you have taken and with any action, prepare for a reaction.

          In your example, I'm not sure if it would have worked the way you mentioned. You had insurance, which lapsed as it was sent to the old address. So even if you had ticked you were 'insured', you would actually not have been insured as your insurance has not been renewed. You would only have ticked the box if you wanted to stop your current insurance (which you didn't, it just lapsed).

        • try2bhelpful on 22/02/2018 - 18:18

          @mbck: You would need proof of insurance; that is a completely different thing to me saying I have it. In my case I would've looked for the policy and gone - ooops.

          Basically my current car is probably not worth getting comprehensively insured and I am willing to live with the risk that I will have to pay for a replacement if the accident is my fault. What I am trying to ameliorate, and a lot of other people according to the poll, is to not be out of pocket when it isn't my fault.

          Under the current system if a person without insurance hits you and they will not pay, and have few assets, then it is not worth chasing them to get your car fixed; then you bear the cost of fixing the car. (There is posting after posting here on Ozbargain of people who have been in side of the fence on this.) What we are trying to achieve is an easy, cost effective method of getting as many people insured as possible.

          Why should I pay comprehensive insurance at rates that are ridiculous, given they will write my car off for roughly $5,000, to cover somebody else running into me; when this scheme would ensure they have third party property and the cost would be covered as a standard claim at a much lower cost.

          Comprehensive insurance is one of life's great rip offs unless your car is relatively new.

        • mbck on 22/02/2018 - 18:38

          @try2bhelpful:
          Comprehensive is not a rip off as I pay 760 for a brand new kia.

          Its only a rip off if you have multiple claims and classified as high risk.

          You get comprehensive so that you don't have any headaches. If there are issues, you pay the excess and that's it.

          Forcing everyone to be insured will increase costs for everyone. And the benefit of forcing people to have top? To cover for people who take risk not having insurance.

        • try2bhelpful on 22/02/2018 - 18:53

          @mbck:

          We are certainly not high risk; please give us the name of your insurance company and suburb you live in. I genuinely want to talk to these people.

          Forcing everyone to have property insurance will only increase costs for the people who currently don't have insurance; everyone else's insurance costs will probably go down due to the larger pool of people with insurance. It will also mean that people will not have to chase the person who has caused the accident to get payment; it will be covered by the insurance companies. As indicated, simple tick the box pay the money system that people can opt out of if they have their own insurance. You could even allow people to opt out altogether but, I suspect, if the price is correct and the system is simple that most people will go with the insurance. if you can get comprehensive insurance for $760 for a new KIA then imagine what a properly managed system like this could get third party property down to.

          Not sure why you thought you had to bring in life insurance, as that is a different ball game, but I think you will find that most superannuation policies have a simple - tick the box if you want life insurance option as well; often at no additional charge. You can get your own but most people probably stick with their Superannuation option as it is simple.

    • JimmyF on 22/02/2018 - 20:01

      At the moment the "reckless" 18 year old has no insurance and no assets to claim against when he hits your car so you are out the cost of repairing your car

      ????

      I pay nothing if not at fault and can supply the driver and/or rego of the other party.

      Your statement assumes you also have no insurance and have to take them to court.

  • Iangh on 22/02/2018 - 16:06
    +2

    Mandatory in UK to have at least third-party. Most people go comprehensive.

    • Euphemistic on 22/02/2018 - 18:20

      I wonder how tha has affected insurance prices since its inception.

      • try2bhelpful on 22/02/2018 - 18:54

        would be interesting to see an analysis on that.

        • Euphemistic on 22/02/2018 - 19:09

          It would be a big market with a lot of competition.

        • try2bhelpful on 22/02/2018 - 19:10

          @Euphemistic: True, however, insurance companies have tables and stuff that could be used to provide some sort of extrapolation.

  • JimmyF on 22/02/2018 - 19:56
    +2

    we have issues with people causing accidents and not having insurance

    Thats why I have insurance……

    and sometimes our client or yourself also does not have insurance or only third party. Forking out a lot of money to fix your own car in the end.

    Not my issue, my car always get fixed, as I have car insurance. Couldn't care less if the other party is out of pocket or doesn't get their car fixed if they caused the accident and don't have insurance.

    Too bad, so sad.

    I've seen customers in tears when they find out we cannot fix their car just because the other side cannot pay for their damage

    So tell me why their insurance isn't fixing it if the other party isn't paying? Oh they don't have insurance just like them. Again, too bad for them! Get insurance!

    Or you take them to court, they cry poor and the best thing the judge can do is either issue judgement against them, offer a tiny settlement which barely covers the cost or offer a long term payment plan. Really?…

    Not my issue, can you guess why? Yes! Thats right, thats my insurance companies issue to deal with.

  • Hithere on 23/02/2018 - 08:40

    As long as I have comprehensive insurance of my choice why should I be forced to pay more for another, and compulsory, policy?

    I pay my premiums for my car to be fixed, doesn't matter if the other party is insured or not. It may sound harsh but it's a fact of life.

    Doubt very much if the State Government will pay any attention to a handful of votes from an Internet poll anyway.

  • altomic on 24/02/2018 - 09:55
    1. Buys 3rd party insuranxe
    2. Pays for rego
    3. Cancels 3rd party insuranc
    4. ??????
    5. Profit.

    They'd have to be mechanism to stop this happening. E.g. cancelling 3rd party can only occur when a vehicle has been sold (proof by transfer paper) or written off (crash report or something).

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