Getting your driver’s license and being able to purchase your own car is exciting when you’re an inexperienced driver.
You get the opportunity to learn more, gain experience and drive without a learner’s permit or supervision.
However, being an inexperienced driver also means potential risks and injuries. Repairing a damaged car is costly. Depending on the model and make of your car, you may find it difficult to find parts. If you succeed, they will be expensive to pay for.
This is where insurance comes in.
Your insurance policy acts as an intangible shield that protects you against legal damages. Without insurance, you may end up bankrupt.
However, new drivers are often confused about what type of insurance to get. There are two types of insurance that cover automobiles: drivers’ insurance and car insurance.
What is Car Insurance?
In Australia, when you purchase a vehicle, it’s mandatory that you get it insured.
Any kind of damage to a third party’s vehicle is covered by your car insurance. However, as with many types of insurance, the policies and coverage you receive depends on your insurance provider.
It is therefore, important that you discuss policies and quotes that you can purchase that will be beneficial to you. Some insurance companies provide free insurance quotes.
As with car insurance, as beneficial it is, there are some limitations. Car insurance generally covers:
- Damage to a third party’s car
- Theft or malicious damage to your car
- Legal expenses, in case of damage to a third party’s car
- Injury to another person (pedestrians or cyclists)
- Injury to person inside your car
What is Drivers’ Insurance?
Some insurance policies only cover the damaged vehicle.
Drivers’ insurance deals specifically with drivers. Your insurance policy may not provide coverage for your injuries.
Instead, it will cover expenses for damage to the third party’s car or your own car.
However, there are different types of drivers’ insurance. Depending on your insurer, in Australia, different territories and states have different legal policies. It is, therefore, important to discuss the legal drawbacks and benefits with your insurance provider in your state.
Liability coverage is one type of insurance that covers the driver. It doesn’t matter whose car it is, the insurance covers for the damages.
However, it depends on the type of policies your insurer is providing you. You can inquire after different policies that cover damages if you or another person has been injured.
Some insurance policies also cover drivers that you have rented your car to. This extends to family members.