Car insurance is a type of coverage that protects you financially if your car is involved in an accident, stolen, or damaged.

By insuring your motor vehicle, you get peace of mind, knowing that if something unexpected happens, you won't have to handle large expenses on your own.

It also offers legal and financial protection, covering things like accidental damage, repairs, and even emergencies such as roadside assistance.

The clear answer is yes. With the right policy, you can feel safe. You won’t have to handle big costs on your own if something bad happens. Vehicle crashes are a big problem in New Zealand. In 2022 alone, there were 378 fatal crashes, resulting in 389 deaths, and 2,258 serious injury crashes.

Car or vehicle insurance in New Zealand typically comes in three levels:

• Comprehensive Car Insurance

• Third Party Fire & Theft Car Insurance

• Third Party Car Insurance

Comprehensive car insurance is the type most people opt for, as it offers the most extensive coverage. This insurance protects you against damages to your own car and also covers damages to third parties involved in an accident. Whether or not you caused the accident, both your car and the other party’s vehicle are covered, and you can file a claim to repair or replace your car.

Third Party Fire & Theft car insurance and Third Party Property Damage car insurance provide coverage if you're in an accident, but only for the other person’s vehicle. Your car is not covered, meaning you’ll need to pay for any repairs or replacement yourself. The Fire & Theft component ensures your car is covered if it's stolen or damaged by fire.

When evaluating car insurance, it's important to consider the benefits and coverage of each policy. Comprehensive car insurance provides protection for both your own vehicle and others involved in an accident, offering peace of mind in many situations. On the other hand, Third Party Fire & Theft or Third Party car insurance only covers damages to the other person’s vehicle and does not cover costs for your own.

Given the prevalence of car accidents in New Zealand, having the right insurance is important to avoid significant financial burdens in the event of an accident.

If your car is not particularly valuable and you’re comfortable paying for repairs yourself after an accident, Third Party insurance might be the right choice for you, as it's less expensive. According to our data, it typically costs around $508 a year, compared to approximately $1,317 for comprehensive insurance.

If you own an expensive car, such as one valued at $40,000, comprehensive car insurance is a better option. It covers repairs, theft, lost keys, and other issues, giving you peace of mind because you know you’ll be protected no matter what happens. The main reason to choose comprehensive car insurance is the security it provides, ensuring that the costs to repair or replace your car after an accident are covered. It also protects you in case the other driver is uninsured.

Third Party (including Fire & Theft) does not pay for repairs or replacement of your vehicle after an accident and offers only limited coverage if an uninsured driver causes the crash. For example, it might cover up to $3,000.

You can use the Quashed Market Scan feature to compare prices and benefits from different car insurance companies. It helps you save time and effort. You won't need to visit several sites or fill out many forms.

To choose the best car insurance policy, you need to compare quotes and policies from different insurance companies. Consider the coverage options that fit your needs and budget. Checking customer reviews is also important to see how satisfied others are with the service. Finally, it's wise to check if there are any extra benefits or discounts that insurance companies offer for your motor vehicle.

Importantly, finding the best car insurance depends on what you are looking for. Some might want the cheapest car insurance available, while others may look for benefits like higher coverage limits and fewer exclusions. For some people, easy access to customer support matters, while others just want a claims process that is simple and quick.

Let’s look at some different ideas on what the best car insurance could be for you. To get the cheapest car insurance, you should compare prices from different insurance companies. Many insurance companies provide online quotes. Some of these include AA Insurance, Tower, AMI, and State Insurance. If you are looking for car insurance with great benefits and comprehensive coverage, you should examine the details of each plan. Check what benefits are included, such as:

• Lost or stolen keys,

• Emergency accommodation,

• Transport cover, and

• Windscreen cover.

Remember that all of these depend on the current underwriting criteria and the level of cover offered. Some car insurance companies may cover lost or stolen keys. For example, one insurer might offer $300 for this, while another may offer up to $1,000 for the same issue, especially for standard vehicles and utes.

Some insurers do not cover lost or stolen keys at all. In a comparison of comprehensive car insurance policies, State Insurance provides up to $300 for this coverage, while Tower offers up to $1,000. AMI does not cover lost or stolen keys, but they do include roadside assistance in their insurance package.

If you want to compare benefits and limits, you can go to each insurer’s website or, use the quick and simple option which is the Quashed Market Scan feature. Simply enter your details once, and it will search multiple insurers for quotes and policy comparisons. You’ll save time and get a clearer picture — all in one place.

Car insurance costs can vary a lot depending on a few things, like the type of car you drive, your age, where you live, and your driving history.

Based on our research and data in Q2 2024, across all ages we find that the average:

• Comprehensive car insurance cost $1,317 a year

• Third Party and Third Party Fire & Theft cover cost $507 a year

You can expect to pay 26% more for car insurance in Auckland when compared to Wellington. For drivers in Christchurch you can expect to pay about 3% more than the folks in Wellington for your car insurance.

A good rule of thumb when deciding how much to insure your car for is to choose an amount that would cover the cost of replacing it with a similar one if it were totalled in an accident, destroyed in a fire, or stolen.

When it comes to a second-hand car, it can be slightly tricky. If you bought a second-hand car at a great price and insured it for that amount, but later got into an accident and the car was written off, the payout from the insurance company might not be enough to get you another car of similar age and condition.

For example, if a one-year-old Toyota Corolla is worth $25,000, but you purchased it for $20,000 and insured it for that amount, and then got into an accident shortly after, the $20,000 payout might not be enough to replace it with a similar car, as the price you paid was a one-off good deal.

When it comes to second-hand cars, one great strategy to get the right valuation is to use Trade Me’s car valuation tool. This tool will give you a good indication of how much you should insure your car for.

Insurance companies will also have a range of how much you can insure your car for. When requesting a quote online, if you enter an amount that is too high (e.g., $50,000 for a 2010 Toyota Corolla), the system will prompt you to lower the amount

To compare car insurance, you can visit individual insurance websites such as AA, State, AMI, Tower, and others to get a quote, or you can simply use Quashed. Market Scan by Quashed allows you to compare prices and benefits against your existing car insurance policy, or you can simply find comparisons for new cover. 

There are several ways to save on car insurance costs.

• Consider purchasing Third Party or Third Party Fire & Theft car insurance. This is typically 30-40% of the cost of Comprehensive insurance.

• Bundling with other insurance policies you have with one provider could be a way to access cheaper premiums. However, note that Quashed recommends checking to see if bundling actually saves you money. Sometimes, by comparing across insurance companies, you could save more and get the best cover for each type of insurance. For example, AMI may have a strong Contents or Home insurance policy, but their Car insurance may not be as competitive in terms of benefits.

• Pay less when you drive less. Some insurers will price your car insurance based on the distance or frequency you use your car. For example, Cove asks how often you use your car per week (e.g., 0-2 days, 3-5 days, or 6-7 days). Depending on your answer, the price you can expect to pay changes. The less you use it, the less you pay. Choosing 0-2 days of use per week instead of 6-7 days can save you almost 20%. Remember to be accurate and truthful, or you run the risk of not being able to make a claim when you need to.

For young drivers under the age of 25, there is a higher risk of accidents. As a result, insurance for this group will typically cost more. There are a few other things to know about car insurance for drivers under 25:

• You will need to be added to a car insurance policy to be covered in most cases. Unlike drivers over the age of 25, most insurers will still provide cover if you are legally allowed to drive the insured car. For example, if you are over 25 and your friend gives you permission to drive their car for the weekend, and it is insured, the insurance will most likely cover you even if you are not specifically named on the policy. For drivers under 25, this is usually not the case. Unless you are named on the car insurance policy, you run the risk of not being covered.

• Your insurance excess will most likely be higher than the normal excess paid by those over 25.

• You will struggle to find insurance for performance cars if you are under 25. Most insurance companies will either charge you a significant amount or will not cover you for performance cars. If you do own a performance car and are under 25, you can try specialist insurers such as NAC and Club Auto. General insurance brokers are another good way to explore your options. You can connect with a general insurance broker on Quashed for free.

To lower the cost of car insurance for drivers under 25, you can add your parents or someone older than 25 who also drives the car to the policy. We have seen this reduce the cost of insurance for some policies. Driving safely and avoiding performance cars is another effective way to avoid expensive premiums. Car accidents on your record will almost certainly increase your premiums, sometimes significantly, as insurance companies see you as a higher risk and charge you accordingly.

Most of us will be familiar with purchasing car insurance online through some of New Zealand’s largest insurance companies such as AA, AMI, AMP, State, Tower, Cove, and Initio.

There are many other lesser-known insurance companies that offer car insurance which are competitively priced and provide good benefits. Alternatives such as Cove and Initio offer great value and are based locally and backed by some of the biggest underwriters in the world.

Banks are another channel where you can purchase insurance. ANZ, ASB, BNZ, Westpac and Kiwibank are some examples. Even smaller banks such as TSB, Heartland, SBS and some building societies offer car insurance.

To compare car insurance before you buy, Quashed Market Scan provides a quick and easy way to get multiple quotes and compare policy benefits and limits.

In the event of an accident, you are legally required to stop (safely out of moving traffic if possible), check if anyone is injured, and provide assistance if necessary. Even if you are at fault, do not accept or admit blame to the other driver or their insurer. Simply let them know that you will need to speak with your insurer. This is because most insurers state in their Terms & Conditions that you must not admit fault, or your claim may be dismissed.

Drivers should exchange details, including name, address, contact information, and vehicle registration. Ask if the other party is insured and take down their information. We recommend taking photos of the accident on your phone and swapping driving licence details. Make notes of the location, date, time, and any other information about the accident you can recall while it’s fresh in your mind. This will be helpful when filing a claim with your insurer or if a police report is required. If the car is not yours, you will need to inform the owner of the vehicle.

There are usually two ways you can make a claim with your car insurance company:

First, you can give them a call. If you are using Quashed to store and access all your insurance information, simply open your dashboard on your mobile and click on the call button. It will connect you directly to your insurer.

Alternatively, most insurers now offer online claim forms where you can provide more information based on your individual circumstances. Simply go online, fill out the claim form, and the insurer will be in touch with you. Next, your car will need to be assessed, which may involve you taking photos of it or, depending on the condition, driving it to one of their assessment centres. The insurer will then determine if you need to pay the excess (when you are at fault), and the rest will be covered by the insurer for the repair.

If you are not at fault, you may be able to access a free courtesy car from either your panel beater while your car is being fixed, or through specialist hire companies such as Right 2 Drive, which can provide roadside assistance and a rental car for the period you are without your car. They will aim to claim the transport costs back from the at-fault party's insurer.

• Keep your WOF and REGO up to date – It’s easy to forget, but keeping your Warrant of Fitness (WOF) and registration (REGO) current is crucial – they can actually affect your insurance. So, before you hit the road, make sure everything is up to date!

• Stay calm in an accident – If you’re ever in an accident, try not to stress! One key thing to remember is not to admit fault straight away, even if you think it was your mistake. Let the insurance companies figure that part out for you.

• Double-check your car’s value – It’s a good idea to ensure your car is insured for enough to buy a similar replacement. Things change over time, so it’s worth taking a quick look at your policy to be sure.

• Don't forget the details – Check the policy wording of your insurance to ensure you are fully aware of the details.

• Shop around for the best deal – Why not compare prices? Market Scan makes it easy to compare insurance plans, so you can find the best cover that suits your budget. You might be surprised how much you can save!