How to Compare Car Insurance in NZ and Find the Best Deal

22 October 2025

Choosing the right car insurance is not as hard as most people think. With premiums on the rise, and the difference between the cheapest and most expensive quote for the exact same car and driver can be staggering, it's a great time to compare and find the right car insurance for you.

This guide will teach you exactly how to compare car insurance in New Zealand, what to look for, and how to find a car insurance policy that gives you peace of mind without overpaying.

Step 1: Understand the Three Main Types of Car Insurance

Before you get a single quote, you need to know what you're buying. In NZ, car insurance boils down to three main levels of cover.

1. Comprehensive Insurance

This is the full-package deal. It covers:

Damage to your own car (from an accident, fire, theft, or vandalism).
Damage you cause to someone else’s car or property.
Extras such as replacement of car keys, towing, accommodation, rental car, child seats and more
Who is it for? Most drivers. It's essential if your car is worth more than a few thousand dollars, or if you rely on it daily and couldn't afford to replace it out-of-pocket. If you want the highest level of cover, this is it.
Average cost: $1,236 in 2025 (low - $933 and high - $1,621)

2. Third Party, Fire and Theft

This is the middle-ground option. It covers:

Damage you cause to someone else’s car or property.
Your car if it’s stolen or damaged by fire.
It does not cover accidental damage to your own car (e.g., if you reverse into a pole).
Who is it for? A good option if your car has a lower value (e.g., $2,000 - $7,000), but you still want protection from theft, which is a significant risk in some areas. You are not worried about the extra benefits and cover.
Average cost: $470 in 2025 (low - $360 and high - $573)

3. Third Party Only

This is the most basic, and cheapest, level of cover. It covers:

Damage you cause to someone else’s car or property only.
It does not cover any damage to your own car, for any reason (incl. fire and theft)
Why get it? In New Zealand, third-party insurance is not compulsory.This makes it incredibly risky to drive with no insurance at all. If you hit a $150,000 Tesla, you would be personally liable for the repairs. Third Party cover protects you from that very expensive financial risk for a very low cost.
Who is it for? Drivers with a very old, low-value car that they could easily afford to replace.
Average cost: $272 in 2025 (low - $208 and high - $367)

Step 2: Know the 5 Key Factors to Compare (It's Not Just Price)

Once you've decided on the type of cover you need, it's time to compare quotes. A more expensive policy can provide more cover, but not always. Look closely at these five factors for every policy.

1. The Premium: What You Pay

This is the sticker price—your fortnightly, monthly, or annual payment. This price is unique to you and is based on:

Your Location: Premiums in Auckland are significantly higher than in Christchurch or Wellington due to higher likelihood of claims e.g. theft and accidents.
Your Age & History: Drivers under 25 pay more (usually 20-30% more). In your 60s, you can expect to pay up to 40% less than in your early 20s. A clean driving record with no claims will lower your cost.
Your Car: The make, model, year, and even colour of your car affect its risk profile for theft and repair costs.
Car Usage: A car used to commute to work (daily driver) will cost more to insure than one used recreationally with less mileage covered each year.

Look out for: How much you can save when paying yearly instead of fortnighly or monthly.

2. The Excess: What You Pay When You Claim

The excess is the amount you must pay out-of-pocket before the insurance company pays the rest.

Standard Excess: This is the most common selected in NZ is $500.
Voluntary Excess: Most insurers let you increase your excess (up to $2,500). In return, they will lower your premium. This is a good way to save money if you can comfortably afford to pay that higher excess a.
Additional Excess: Insurers will often add extra excesses for high-risk situations, such as for drivers under 25 or drivers on a restricted licence, and drivers that are not named on the policy.

Look out for: When comparing quotes, check you're comparing the same excess.

3. Agreed Value vs. Market Value

For Comprehensive policies, your insurer will pay out your car's value if it's written off. How they determine that value is important for you to know.

Market Value: The insurer decides what your car is worth in the "market" at the moment of the accident and claim. This value could be lower than what you think or the amount you paid for if it was bought a long time ago.
Agreed Value: You and the insurer agree on a fixed dollar amount for your car as listed on your policy (e.g., $15,000). If your car is written off, that is the exact amount you will be paid (minus your excess).

Which is better? Agreed Value gives you certainty. Market Value can be more cost effective .

Action Point: Know your car's value. Check your policy yearly if it's an agreed value.

Check Trade Me for cars of the same make, model, year, kilometres and condition.
Use online valuation tools such as Trade Me's free valuation tool.
Check this value yearly. Insurers can lower the agreed value on your policy.

4. Optional Benefits & "Add-Ons"

This is where policies really differ. A slightly more expensive premium might be worth it if it includes benefits you need. Look for:

Excess-Free Glass/Windscreen Cover: Lets you repair or replace a chipped or broken windscreen without paying your excess. Highly recommended as this is a common claim.
Rental Car Cover: Provides you with a rental car (or a daily transport allowance) while your car is being repaired after an accident.
Roadside Assistance: Most insurers offer 24/7 roadside assistance as a cheap add-on (often around $50 a year), which can be much cheaper than a separate AA Membership (around $90).
No Claims Bonus (or Rating): A discount that rewards you for being accident free. Most insurers will bump up your premiums if you’ve had an accident in the past three years – especially if you were at fault (i.e. had to pay an excess).

Action point: Don’t just tick them all. If you have an existing AA membership, you probably don’t need to add the Roadside Assist option on your car policy.

5. The Exclusions: What They Won't Cover

Always, always read the "What we don't cover" section of the policy document. Common exclusions include:

Business use (especially for Uber or similar).
Damage from drink-driving or drug-driving.
Damage from racing, track days, or off-roading.
Modifications you haven't declared (e.g., new mag wheels, suspension, engine mods).
Tyre damage (unless it's part of a larger accident).
General wear and tear.
Mechanical damage or breakdown.

Action point: Got a question? Ask. Don't leave it to chance.

Step 3: How to Get and Compare Quotes

Now you're ready to shop around. Don't just get one or even three quotes. Get at least five or more as the price difference can be staggering. It can be half the price or double the price across the various insurance companies.

1. Use Online Information Sites: Websites like MoneyCompare, MoneyHub, and Canstar are good starting points. They provide information on car insurance, simple snapshot comparisons and some examples. Beware of websites that only recommend 1-2 car insurance providers.

2. Use Real-time Comparison Sites: Platforms such as Quashed provide real-time quote comparisons across 5 or more car insurance providers so you get a good indication of what you will pay. They also provide a comprehensive comparison of policy benefits so you can easily compare apples for apples.

3. Get Direct Quotes: Not all insurers are evaluated or compared on the sites above. You can fill in the gaps if there are any insurance providers you want to compare.

4. Explore the "Challengers": Lesser known and digital insurance providers such as AMP, Assurant, Autosure, Cove, Provident Insurance, can often be very competitive with price and also the benefits, especially for good drivers with standard cars. Don't write them off without comparing their offer.

Action point: Skip the spreadsheet. Make use of free online resources and platforms such as Quashed.

Quick Car Insurance Comparison Tips for NZ Drivers

Don't Just Auto-Renew: Loyalty rarely pays. Your insurer is counting on you not checking. Shop around every single year.
Compare 5+ options: Some insurers are willing to take more risk and offer lower prices even for young drivers, others are not. The price difference can be a huge $1,000+.
Pay Annually: Most insurers offer a discount (around 10-15%) if you pay for the full year upfront instead of monthly.
Take a higher excess: Save and create a rainy day fund and opt for a $1,000+ excess to significantly reduce your premium (20% or more).
For Young Drivers (Under 25): Your insurance will be expensive, but you can save.
- Choose your car wisely: A 1.5L Toyota Corolla would be cheaper to insure than a 2.0L Subaru Impreza.
- Be a named driver: It's often cheaper to be a named driver on your parents' policy (if you only drive their car occasionally) than to get your own.
- Do NOT "front": This is where a parent insures a car in their name, but the young driver is the main user. This is fraud and your claim will be rejected.

Your Final Checklist

Before you buy, ask yourself these 6 questions:

Have I chosen the right level of cover for my car's value? (Comprehensive vs Third Party Fire & Theft, or Third Party Only)
Have I compared the premium and the total excess?
Do I understand my car’s value and if I want an Agreed Value or Market Value policy?
Have I checked what optional extras (like glass cover) are included or cost extra?
Have I read the main exclusions in the policy document?
Have I tried free resources such as Quashed to compare my car insurance?

By following these steps, you'll move from being a confused consumer to a savvy insurance shopper. You'll not only save money but also have the confidence that you're properly protected.