Car insurance is something few people think about. It’s a case of get the paperwork, pay it, forget it. Then when they’re in a crash the insurer tells them how they’re insured wrong, and they’re left in the lurch. After reading this you should be able to cover yourself to maximise your chances of getting your damages paid by insurance.
To an insurer, if something has a rego then you can insure it as a “vehicle.” So your ute, your sedan & your trailer are all seen as a “vehicle” to them.
Insurance Types: CTP Or Vehicle Insurance
The insurance for your car comes in 2 main types; Compulsory Third Party (“CTP”) and Vehicle Insurance. CTP insurance is what protects you if you hurt someone while using the car, and depending on your State or Territory it is included in your registration or as a separate insurance policy. On the other hand Vehicle insurance can foot the bill if you damage your own car or damage other people’s objects.
Vehicle Usage: Private Use Or Business Use
Now Vehicle Insurance is where things get interesting. Depending on how you use your vehicle, it can be insured for Private Use Only or for Business Use. Generally Business Use vehicles will be insured for both personal & commercial trips, but Private Use Only will only be insured for personal trips. So if you have the car registered in the business name, if you claim tax for its expenses or if you drive to jobs or to pick up supplies, choosing “business use” helps to make your insurance more reliable.
Policy Types: Personal Motor Or Commercial Motor
If the vehicle is for Business Use, then you have the choice of insuring it under aPersonal Motor Policy or under a Commercial Motor Policy. If the vehicle is for Private Use, then you insure it under a Personal Motor policy. The main difference between these 2 is what the insurer will allow, and what bells & whistles they offer. In fact, some insurers will not insure tradies under a Personal Motor Policy because of the stock & tools often carried around!
The bells & whistles in a Personal Motor Policy are designed to be helpful to someone who only drive their car to work, the shops, or for fun – so Personal Motor Policies have benefits like automatically insuring a caravan or cover for baby seats. A Commercial Motor Policy has bells & whistles that are there to benefit a company that uses cars – so it has benefits like redoing your signwriting or improving the cover for unspecified drivers.