When I first arrived in Australia back in November 2007 and bought my first car, I had to pay, like anyone else, for rego, or car registration. This is the thing that we Brits would call car tax, but Australian rego was slightly different.
I thought it was quite “quaint”, as in attractively unusual rather than old-fashioned, that third-party insurance was included with this rego. To give it its full name, Compulsory Third Party (CTP) insurance.
Car insurance in the UK
In the UK, for those who don’t know, for the most part we would choose between fully comprehensive, third-party fire and theft and just third-party for our car insurance and that would be totally separate from car tax.
Fully comprehensive, or fully comp, meant if you had an accident, the cars, the buildings and whatever else you smashed into would all be fixed up and paid for, including any damage to your own car no matter whose fault it was, by the insurance company. Personal injury, injury to other people, whiplash, all paid for.
Third-party fire and theft covered everything above except damage to your own car, but you would get paid out for your own car if it caught fire or was stolen.
Third-party didn’t cover your own car for anything, but did cover all damage to other cars and property and injury claims from other people.
Third-party was the absolute minimum insurance drivers would have to take out to legally drive a car.
Car insurance in Queensland
Note that I said Queensland, not Australia; I’ll take a quick look at the rest of Australia later. On with the story.
About 2 1/2 years ago we bought a second car…
…the one Mrs Bobinoz has been driving around in ever since. We didn’t bother getting fully comprehensive insurance; we felt that the CTP included in rego would be enough. A couple of weeks ago we found out exactly what CTP insurance really is.
As I have done more research on this subject for today’s post, I came across this description of CTP …”Compulsory Third Party (CTP) personal injury insurance.”
As that full description along with those extra three words on the end imply, it covers personal injury, not your own if the accident was your fault, but the personal injury of your passengers and anybody else involved in the accident.
It does not cover any damage to cars, buildings or any kind of property whatsoever.
We didn’t know that, we were thinking in terms of the UK’s “third party” insurance.
Had my wife collided with a Lamborghini Gallardo LP550-2 Coupe E-Gear Nero Serapis (approximately half a million dollars worth) towing a Mustang 3800 Le Sportscruiser speedboat (a $150,000 toy) causing both irreparable damage while at the same time both herself and the driver of the other vehicle walked away unscathed…
“Oh my word, I’m so sorry, I didn’t see you and that great big boat!”
“No worries, these things happen, eh? You OK?”
“Not a scratch on me!”
… then that CTP insurance would have meant for nothing and we would have had to dig deep into our pockets (hehe) for about $650,000.
Just goes to show, doesn’t it, that it pays to read the small print.
Fortunately, in those 2 1/2 years, no such accident happened and we are not, as I speak, bankrupt.
Yes we’ve been a bit foolish, no, we should not have made assumptions, but I did think this was well worth mentioning so that others do not make the same mistake that we have.
What are the rules in the rest of the country?
Firstly, rules change, so always be sure you do what I didn’t do, and read the small print. Secondly, this is just a cursory and quick look around the rest of the country, it is not a definitive guide to car insurance in Australia.
Here’s what I think happens in other states:
New South Wales
CTP insurance, called a “green slip” is the minimum legal requirement but it is NOT included in rego, it is a separate item. You will need to arrange your CTP insurance first otherwise you will not get your rego, and if you let your rego run out, then your insurance becomes invalid.
In Victoria it is known as the Transport Accident Commission (TAC) charge but it is CTP insurance just the same. Like Queensland, it appears to be part of the rego fees.
Seems to be exactly the same as New South Wales, except they do not have a fancy name for it.
South Australia, Tasmania and ACT
Seems to be exactly the same as Queensland, except they do not have a fancy name for it.
Seems to be exactly the same as Queensland, except they operate a “no-fault” accident compensation scheme, this means that if you injure yourself you will be able to claim medical expenses for your personal injury, even if the accident was your fault.
There you go, simple, wasn’t it?
As I have already said, this was a very quick look at insurance around Australia, so please do check the small print and make sure you know what the current rules are.
Is this a problem?
I just have one question out of all of this; if you are driving your Lamborghini Gallardo LP550-2 Coupe E-Gear Nero Serapis (approximately half a million dollars worth) towing a Mustang 3800 Le Sportscruiser speedboat (a $150,000 toy) and somebody with CTP insurance does smash it all up, how are they really going to pay you?