What is car insurance and how does it work?

If you’ve just bought a vehicle, you might be shopping around for car insurance. With many cover options available, it’s sometimes difficult to choose what kind of protection you need. Did you know that the age of your car and the way you use it can affect your premium? If you’re not sure where to start, read our guide which may assist you in determining what car insurance might work for you.

What is car insurance?

Car Insurance is a type of insurance policy you can buy to help mitigate financial costs if you are involved in a car accident. You can insure your car to protect it against damage in an accident, theft, or damage to another person’s vehicle.

How does car insurance work?

Depending on the type of car insurance you buy, certain policies may help cover costs like - repairs from an accident, damage to other people’s property, theft and fire, and more. Here’s how it works:

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  • You take out a Car Insurance policy that offers a specific level of cover with an insurance provider (like Woolworths Insurance). You agree to pay a premium to the provider on a monthly or annual basis.
  • You (the policyholder) now have cover for your vehicle based on the benefits listed in your policy.
  • If you are involved in an accident or incident that is covered during the policy period, you may be eligible to make a claim to help pay the costs of repair or damage.
  • If your claim is approved, you may need to pay a certain amount towards the cost of repair or replacement - this is called an ‘excess.’
  • You will only be covered by your provider for 12 months. Insurers may offer you a renewal towards the end of the policy period that could involve a change to your cover, the amount of your vehicle, and your premium.

Is car insurance worth it?

Insurance may protect you in the face of an unexpected incident. If you’re driving to work one day and accidentally hit another person’s vehicle, you could be liable to pay a lot of money to cover the damage if you’re uninsured.

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Compulsory Third Party Car Insurance (CTP)> is mandatory personal injury insurance for you and for anyone who is injured during an accident. It is illegal to drive a car without Compulsory Third Party Insurance. Other types of car insurance include: 

  • Comprehensive
  • Third Party Property, Fire & Theft 
  • Third Party Property Damage

Each type of car insurance offers different benefits, limits, exclusions and level of protection. Things that affect the type of Car Insurance and level of cover you might need include: 

  • The age of your car
  • What it’s used for
  • Any finance owing on it
  • How often you drive it

Assessing these factors should give you a clearer idea of what type of car insurance is most suitable for you.

Woolworths Insurance also offers Drive Less Pay Less cover, which is designed for cars that are driven 15,000km or less per year. It offers all the benefits of Comprehensive insurance, but you only pay for the kilometres you plan to drive.

It's important to carefully read the Car Insurance Product Disclosure Statement and consider the Target Market Determination to decide if these products are right for you.

What Car Insurance Policies does Woolworths Insurance Offer?

Woolworths Car Insurance offers flexible cover options for you and your car.

Comprehensive Car Insurance

Our Comprehensive car cover provides protection for damage to your car as well as other people's property.

Drive Less Pay Less Insurance

Woolworths Drive Less Pay Less offers cover for cars that are driven 15,000km or less per year.

Third Party Property, Fire & Theft

We cover you for all the benefits of third party property damage along with theft or attempted theft and fire.

Third Party Property Damage

Third Party Property Damage cover protects you if you cause damage to another person’s vehicle.

How do I get car insurance?

Whether you’ve just purchased a new vehicle or are looking for a new type of cover, Woolworths Insurance offers flexible, affordable cover options for you and your car.

Get a car insurance quote online today and see how much you could save

Why pick Woolworths Car Insurance?

price beat

Price Beat#

If you're 25 or over, we’ll beat any current comparable Comprehensive renewal notice

save online

Buy online and save

We're offering up to 15% off your policy when you purchase online

drive less pay less

Woolworths Drive Less Pay Less cover

Eligible drivers could save up to $235 with Drive Less Pay Less*

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More information about Car Insurance

Want to learn more about Car Insurance? Take a look at some of our resources below:

Offer may be withdrawn or varied at any time. Based on comparable Comprehensive cover. Subject to minimum premiums. Savings apply for the first year only. Terms, conditions and eligibility criteria apply. Any other available discounts applied before price beat. Please read the full terms and conditions on our website.

† Up to 15% discount consists of 3 parts: 5% first year discount, 5% off for online applicants (both of these are first year only), and up to 5% off to exclude drivers under 25. Minimum premiums may reduce savings discount. Any part, or all, of the 15% discount offer can be withdrawn at any time.

> CTP Insurance is issued by QBE Insurance (Australia) Limited ABN 78 003 191 035 for whom we act as an agent.

* Savings between $0 to $235 derived from premium comparisons between Woolworths Comprehensive cover option and Drive Less Pay Less option. Calculations based on profiles of existing Woolworths Car insurance customers who advised they drive under 15,000 km annually. Current as at 30 June 2020. Actual savings are determined by your individual circumstances, including the kilometres selected, excess chosen and other risk factors. Minimum premiums may reduce savings. Kilometres can be increased during the policy period, an additional premium is payable. In event of accident and end odometer reading exceeded, additional excess applied.

Benefits are subject to the terms and conditions including the limits and exclusions of the insurance policy. Any advice provided is general only and may not be right for you. Before you purchase this product you should carefully read the Car Insurance Product Disclosure Statement and consider the Target Market Determination to decide if it is right for you.