Why Don't You Have Car Insurance?
What do you do with the money you save?
Will you post here for help when you crash?
Why Don't You Have Car Insurance?
deme on 11/03/2021 - 11:34
Comments
Good luck getting a 250 dollar comprehensive insurance from these guys.
@earth worm jim: I think the comprehensive insurance for my car (valued at $7k) was about $270, $20 for a years worth of insurance wasn't bad.
And the $100 was for a $180 third party insurance.So all up would say it's a pretty good deal unless you don't like free money.
@Drakesy: I have a car valued at 8-9k. Cheapest third party insurance for my car was around $400+ and comprehensive around $900+. I honestly don't know where you are getting 270 and 180 dollar insurance from unless you actually work for the insurance company.
Suncorp even gave me a $50 voucher for switching my CTP to them this year.
250 and 180 for Comprehensive? What a joke. You wouldn't even get third party for that much less gift cards.
I don't have comprehensive insurance for my car, but I do have a TPP from NRMA. When I got an online quote for my car, a 2007 corolla hatch in 2020 January, the agreed value was $4,200 and the premium was $1,031. It didn't make sense to pay around 25% of the value im going to if my car is written off. So I went with a TPP which was $360 at that time.
Exactly. If you have a cheap car and the means to replace it if it gets totalled, TPP only is fine.
Some insurers are bonkers. A while ago I had a 15 year old Ford Fairmont. Cost me $1500. Youi wanted $4000pa for comp. I'd literally have to write it off 3 times* a year to make it worthwhile.
*Once factoring in excess
I only have third party, i think this should be a minimum to be allowed on the road
In the UK it is. Was amazed when I moved here and it wasn't compulsory.
Compulsory third party or third party property?
why dont you have home insurance
why dont you have health insurance
why dont you have travel insurance
why dont you have life insurance
why dont you have income protection
why dont you have TPD insurance
why dont you have funeral insurance
why dont you have pet insurancedepend on your risk appetite
why dont you have home insurance - i do
why dont you have health insurance - i do
why dont you have travel insurance - i will
why dont you have life insurance - i do
why dont you have income protection - i do
why dont you have TPD insurance - i do
why dont you have funeral insurance - Because its a scam
why dont you have pet insurance - no pet.i love you (work for an insurance company :P)
why dont you have funeral insurance - Because its a scam
It's not a scam, it just serves a small market of people. Some families have religious/cultural requirements in planning a funeral but will just never be able to save up the $15-20k it costs.
Yeah i can see it being tough to save 20K when you're spending so much on insurance.
why dont you have home insurance - i do
why dont you have health insurance - thats what medicare is for
why dont you have travel insurance - don't like to travel
why dont you have life insurance - thats what super benefits are for
why dont you have income protection - thats what super benefits are for
why dont you have TPD insurance - thats what super benefits are for
why dont you have funeral insurance - funeral insurance lol? , i pre-paid my grave along time ago.
why dont you have pet insurance - no need for pet insurance when you have the money to afford it out of pocket.
If you have insurance through your super then you're paying for it and therefore you have insurance
why dont you have home insurance - i do
why dont you have health insurance - i do, because job pays for it but Medicare is the (profanity) best thing in the world.
why dont you have travel insurance - job pays for jt
why dont you have life insurance - i do
why dont you have income protection - i do
why dont you have TPD insurance - i do
why dont you have funeral insurance - Because its a scam
why dont you have pet insurance - crap pay outs, I have plenty of savings to cover the unfortunate.
What's the use of funeral insurance? I thought your primary concern would be life insurance so that in the the unfortunate event of your untimely death, your family would at least receive some financial recompense.
what is a " funeral insurance " ?
Imagine you pay money till you die and then they pay for your funeral.
https://moneysmart.gov.au/paying-for-your-funeral
Funeral bonds and prepaid funerals are a good idea.
Funeral insurance is one of the worst value for money insurance. And I am not even talking about the "you're dead anyway" argument. Most of them are a rort and advertise to vulnerable seniors kind of like the dodgy tradie going door to door, instead they go to nursing homes, lawn bowls and dead air TV shows frequented by seniors.
Because it's a rip off. Insurance is only worth it if you think you are more likely than average to need to use (eg a person with multiple chronic illnesses taking out health insurance). Insurance companies rake in considerably more in fees than they pay out. Insurance should cover you 100%; when you have to pay, say, a $1000 excess you are better going without it than giving money to these blood sucking capitalists. The reason so many Australians have health insurance is because it is heavily subsidized by the nanny state (part of our generous middle class welfare).
I don't have comprehensive car insurance because my car isn't worth covering, I can easily cover the cost to replace it if I write it off.
I have third party insurance on the car because I don't know who I'll accidentally crash into. Also I was paid out by my third party a few years ago when my car was totalled by an uninsured driver.my woolworths car insurance = $300 p.a.
my 10% of groceries once a month = $480 p.a.getting paid to have insurance.
if you shoped at aldi you would have saved more than 10%
Until Aldi have delivery / click and collect that's a no from me. I'd rather pay more to not have to visit a supermarket, particularly Aldi.
The 10% off from WW insurance is a nice little bonus.
I love the level of privilege in the question and so many responses.
For hundreds of thousands of people in this country the answer is “because I don’t have any money for insurance, and I have stuff all to lose.”You can buy a registered car on Gumtree for under $1000 (well, maybe not so much since COVID), or in my experience, inherit one from an uncle or older sibling for nothing.
It gets you to work, or drops the kids at school.
Your budget struggles to pay the rent and the power bill, let alone optional stuff like car insurance. What are they going to do? Sue you?If your assets are below the bankruptcy level there is nothing to lose.
Bankruptcy is not a once off thing, it goes for seven years and some of the effects are life time. Someone is appointed to take care of your finances.
Do not aim to becoming bankrupt to avoid paying for insurance.
If you cannot afford insurance then you cannot afford a car. Take public transport, ride a bike whatever.
What are they going to do? Sue you?
To be clear you are telling people who's assets are less than the cost of replacing cars to avoid paying a couple of hundred a year and just "Yolo I'll go bankrupt".
This is the most dangerous advice I've ever seen on OzBargain. This is far worse than yoloing your savings on GME. Bankruptcy is not something to be taken lightly.
I insure my car, always have.
You are living in a dream world if you think given the option of driving to work on a rainy day with no insurance, or catching the bus because you might want to be a company director in 6 years time is the way people who are broke think.
If you are earning casual wages or minimum wage, like many, many people are, you aren’t scared you might not qualify for a mortgage “if” you are made bankrupt, “if” you have an accident. You’re paying rent for the foreseeable future, not planning for some day when you’ll be comparatively rich.
And if you get hit by an uninsured person, are you really going to spend the resources to teach somebody with no assets a lesson by sending them bankrupt?
I guarantee your insurance company won’t. They’ll try and get some sort of payment plan, and likely end up factoring the debt, which will ultimately be largely uncollected.I’m not advising anybody to drive uninsured, just realistic that hundreds of thousands do, and they do it because it is the smartest financial decision in their circumstances.
You can wish it was different, but reality will disagree.
You are living in a dream world if you think given the option of driving to work on a rainy day with no insurance, or catching the bus because you might want to be a company director in 6 years time is the way people who are broke think.
I've caught public transport to work in the city rain or shine. I also own a car but can't be bothered with peak hour traffic.
And if you get hit by an uninsured person
Nope, I give this to my insurance and go on about my day.
Pay for the insurance.
It would be stupid to drive without it.@deme: You sure are certain about how everyone lives, yet you asked the question.
I’m telling you the actual facts that lots of people can’t afford $200 or $300 a year for 3rd party insurance, that they live in places where driving is the practical form of transport, so they do the realistic thing and drive a cheap, uninsured car.I’ve trudged through the snow to catch the train to my job, and it would be very expensive for me to hit a car if I were uninsured. But my experience is not the only experience, and there are many people with limited assets, and low incomes, for whom property insurance is not a high priority.
I don't think this guy is trying to give advice, he's trying to give some insight into the mind of an idiot, if he were one. I hope….
Well, I yoloed 25% of my savings on GME went to $40 second time around. Look at me now.
You won a bet? Good on you mate. See you at the races.
Insurance is the anti-lottery.
It should cover events that are very unlikely to happen, but if they do happen, they cost you a fortune.
If you can afford to pay out to cover your lack of insurance, it's worth considering. For example, if my car is worth $10,000, I might consider taking the risk of replacing it myself rather than paying a 1k p.a. additional premium for comprehensive, if I have that money sitting around.
Third party insurance covers you if you hit a Ferrari, this could be a payout of 500k!
Home insurance covers the rebuild of your home if it burns down in a fire. This could be a pay out of 500K-1M.
Public liability or indemnity insurance covers you if you are sued for damages, which could have no upper limit.
So it depends on what it is you are insuring. I would never for example pay for phone insurance - I'd rather just pay for a new phone if I lose/break mine.
Well I can't get comprehensive due to some minor hail damage, but because I care about other road users and the stress of having a no-fault accident with someone who has no insurance then I at least have CPP. It's just common decency and only a couple of hundred bux a year.
Why Don't You Have Car Insurance?
I do.
Insurance is merely taking risk off your balance sheet and placing it on the insurers balance sheet.
If you think you have no assets and so "what are they going to do about it?", you'll find yourself in a world of hurt when you realise that they will ruin you in so many ways; it's not just being bankrupt and not being able to get any finance whatsoever, it extends to a lot more than that.
For a pittance, you can buy 3rd party. Why wouldn't you spend $300-odd to save the drama?
Also that's $25 a month. If you can't spend that you can't afford a car.
Exactly
*third party property
I have always been taught that if you couldn't afford car insurance, you couldn't afford to drive. If comprehensive is too much of a financial burden to you, at least have TPP car insurance. Being adverse to risk, I can't see why having no insurance would be a good idea.
If you have enough money, insurance is a good idea.
If you don’t have access to adequate public transport and you don’t have enough money, car insurance would be a much lower priority bill than rent, groceries, power, phone or even discretionary stuff like a birthday present for a child.Insurance is a good idea, an essential even, for people who can afford it. Saying they don’t need to drive if they can’t afford insurance is just ignoring reality for a large number of people.
I would understand that for remote and regional areas it's not always a sound financial decision when you have higher priorities paying rent and bills. However, ownership of a vehicle and the lack of insurance put you at such an elevated financial risk that can easily lead to financial ruin or bankruptcy. A better alternative I see would be the use of public transport and/or the use of a motorbike or push bike.
This is what I am getting at. If you are on a disability pension, or work a minimum wage job, or have only part time work, it is extremely likely you don’t hold lots of assets to risk.
And it is also very likely you don’t have $300 at hand that hasn’t got a bunch of uses much higher priority than buying insurance to protect somebody else’s property.People keep responding as if everyone has $300 in their budget that can go towards car insurance, because all their needs are covered. I’m just pointing out there are hundreds of thousands of people who don’t have all their needs met with their incomes, so for these people not paying for car insurance isn’t something they are happy about, but something they haven’t got many choices about.
And the reality is that people with lesser resources don’t live in housing close to employment opportunities and services, with good public transport options. The instead are over represented in areas far from these amenities, so access to a car is more necessary than for people in more affluent and better served areas.
If your shift at the pub finishes at 1am, and you live 20km away, it’s a 20min drive that uses $5 worth of petrol in your crappy 1998 Magna. Or it is a tiring ride in the dark, a very costly cab ride, or maybe a bus if you are lucky.
Cars are not free to run
Saying they don’t need to drive if they can’t afford petrol is just ignoring reality for a large number of people.
If you can't afford $25 a month to cover damage you cause then you can't afford to drive.
And yet, many thousands of people can afford the petrol to run a car most of the time, but would struggle to find $300 to pay the insurance bill.
It’s almost like you have never been in a circumstance where all your financial needs were not met, so you cannot conceive somebody would choose to spend limited money on the things they need, rather than insurance that is optional.People with less money don’t sit back and happily look forward the hassle and stress if they have an uninsured car crash. But they can prioritise their spending so that things which will be a definite hassle and stress (like the power company going unpaid) get priority over things that might happen, like a car crash.
@mskeggs: The type of person you describe is not poor but irrational. They may be incidentally poor too, but if you can't budget $300 over a year but you can pay for petrol then don't drive.
If you can't afford your power bill, then save money by using public transport.
@deme: It seems you might not have ever known anybody having a tough financial time, yet a fifth of our country fits this segment.
I can’t explain it more clearly than saying, paying $300 for 3rd party insurance “at all” brings very little benefit if you are broke.
Paying for it takes away money you need for important items. Rent, kids xmas gifts, groceries, phone credit, utility bills.
A car costs about $1000 a year to keep legal, plus fuel. You want to add another 30% to that?
If you don’t own a house, and your car is worth less than $8k, nobody is going to send you bankrupt, and if you are broke, you are already used to juggling bills and getting hassled by debt recovery phone calls. One more, if you do happen to have a crash is no big deal. Spending $300 you don’t have to is a very big deal.I understand you think it shouldn’t be this way, and people should just be richer. But you can completely protect yourself from a downside by purchasing comprehensive insurance, which I am sure you do. So don’t preach about how people without your financial resources should live their lives and spend their money.
@deme: You're assuming they have access to public transport. I live in Palmerston and this area is still hopeless for public transport, I've lived in rural areas where there has literally been no public transport.
Its actually the opposite. If you dont have enough money, insurance can help you out in sticky situations. If you do, you can just pay off the damage with your own savings. The expected value (EV) with the insurer is never in your favor. Its just a gamble.
I understand your point, but you are assuming the alternatives are pay insurance or pay for damages.
What if the alternatives are actually pay your rent or insurance? And what if the downside isn’t damages payouts, but just another debt collector calling because you are already broke?Many people on the roads are driving a 1995 Hyundai because they need to go somewhere and they haven’t got money for better alternatives, not because they decided to divert their money to investments or are saving for a holiday.
@mskeggs: Lets say we are talking about 2 people:
Person A - net worth $20m
Person B - net worth $50kScenario:
-both people do not have insurance
-both drive a $25k car
-both met with an accident and its the driver's fault
-both have to pay for a brand new car at the same purchase price ($25k)Person A would only take a 0.125% hit to their net worth compared to 50% with person B.
Insurance would make sense for person B (even though it is not financially beneficial in the long run - see below) as losing half of your net worth is more painful than losing less than 1%.
Copied from my other comment post:
Insurance is gambling and not worth it in the long run for some people because your expected value (EV) with the insurer is never positive or even close to zero.
For example, EV calculation for a hypothetical car insurance policy below:
Probability of getting your car totaled in an accident (driver's fault) = 5% in a year (1 in 20 year event)
Annual Premium plus excess for a comprehensive car worth ~$25k = $1,500Calculation:
0.05 x 25000 = 1250
0.95 x (-1500) = -1425
EV = 1250 - 1425 = -$175@mrvaluepack: Sorry, we are talking about different things.
If you have a $25k car, by all means insure it, but you are doing financially well for yourself to be able own such a vehicle. If you work full time in a shop you earn about $45k. How do you buy a $25k car on that income if you have to pay your other living expenses?If you drive a $1500 car, why would you pay $300 for insurance?
Guys, look out the windscreen next time you drive further than the private school drop off. There are lots of people with very little money, driving cheap cars for whom car insurance is a bad deal.
I feel like I’m responding to people saying, “it’s one banana, how much could it cost? $10?”.
How do you buy a $25k car on that income if you have to pay your other living expenses?
You'd be surprised at people's spending habits vs their income. People have their ego that they need to maintain or sometimes they just wanna splurge. My ex-colleague who was earning ~$65k a year bought a brand new fj cruiser and a fishing boat all in the same year. Reason - wanted to spoil herself.
If you drive a $1500 car, why would you pay $300 for insurance?
Thats why insurance depends on the circumstance. You are correct whereby if person B was driving a $1500 car instead it wouldnt make sense for them to get insurance because the hit to net worth isnt as painful.
Many people on the roads are driving a 1995 Hyundai
Watch your privilege. There is nothing wrong with driving an old car as long as it's safe, road worthy, registered and you have insurance to cover 3rd party liability and damage to property.
@deme: I haven’t made an insurance claim for 20 years.
If I skipped car insurance I would have $6000 towards other expenses or a better car.
I hold insurance because it is a risk mitigation for me, because I am worth suing.
If I wasn’t, that 3rd party property insurance would be worthless, and I would much rather have the money, even if people say “you should have insurance”.You posted a question asking why people don’t have insurance. I have given you the real, true answer. But you insist that it isn’t true because you think people should buy insurance.
I can’t make you change your opinion about insurance, but reality isn’t going to change because you insist true is false.@mskeggs: You likely realised this ages ago, but you're wasting your time here.
Having been raised in a small, poor, country town though, I agree with everything you've said - I saw it all the time growing up - and I admire your tolerance in your exchanges in this thread.
@kale chips suck: Thanks for the kind words.
I’m very lucky to be far from financial trouble these days, but I see plenty of people struggling to get by all around.
And I also see people with absurd levels of wealth.It is very sobering to think that the difference between most is a few bits of good or bad luck, who your parents were, maybe some healthy or unhealthy genes and bits of timing over which you often have no control.
@deme: You sound like you're British noble on your shiny new horse with shiny armour talking down at us farmer peasants…. Are you going to lend us your horse to ride on after we sell our car off?
Too many stupid drivers on the road. Wrote my car off cos someone failed to giveway.
20+ years ago I used to get in so many crashes that not many insurance companies would insure me. I was down to two options. I went with one. Got in another accident and they sent me a letter after 6 months saying I wasn't financially viable so they cancelled my insurance. I haven't bothered since…
Troll?
You seem to not understand people have hard lives. You are on a bargaining website.
No troll. Poor life choices at the time.
saying I wasn't financially viable so they cancelled my insurance.
What really?! HAHAHAHHAHAHAHA I knew these guys were out for making a profit and not there to insure us if we get into a collision!
I fly
But is your chopper insured?
I only have 3rd party.
I have never hit another car.
The money I save goes against my house and is available to redraw if I hit a car.
I don't see the point in paying someone else if I can reduce the loan on my house and keep the money available.
My 'insurance kitty' is at 18k.
I live in regional NSW.
What if you hit a luxury car? That’s what turned alternate Marty McFly Sr into a loser in Back to the Future.
Then I would have to pay for it. The chances of that are slim at best as I don't leave the house much anymore.
If it was serious damage, it would be a hit to my bank account which I could pay, but I could also be in hospital tomorrow needing money for surgery.
So far that money helped me buy a house earlier in life and cheaper as it was before a price boom. It has also been working a lot more for me by reducing my homeloan repayments over the years.It still might be the wrong choice for me in the end, but I feel like I am making the right choice.
:)Why don’t you have comprehensive health insurance then? I wouldn’t trust the public system to treat my dog, if I had a dog and the was a government funded vet health department.
@AustriaBargain: I definitely trust the public system to treat myself and my dog.
If you need a boob job sure go private but you are insane if you are to try get treated for an emergency at a private hospital. They are setup for high profit margin elective surgery.
@deme: I think it’s more insane to ultimately trust a bunch of government boobs to have your back when you need medical help the most. We don’t even trust the average politician near our daughters.
Headline after headline of health system boobery and neglect, it’s pretty obvious that to the average hospital employee having a health minister be your ultimate boss is not a good enough incentive to do the right thing.
@AustriaBargain: I'm not disputing our current mob are stupidly cutting funding to hospitals to pay for helicopters and money laundering war money.
I'm saying private hospitals are not setup for emergencies.
If I had to choose between emergency surgery at a public hospital or a private hospital (even if it was free) I'd choose the public one.
I totally agree our politicians are (profanity).
home loan offset
Mate it's 18k.
Not only are you liable for damages to other cars you are liable for damage to property.
The chances of that are slim at best as I don't leave the house much anymore.
Why bother registering the car at all then.
18k? Property boom?
How much did you save before the boom? 1k?
Unless you can calculate your savings in home loan interest you are just feeling like it's a good idea when in reality it's a terrible idea.
Third party compulsory or third party property?
This confused me as well. He must be talking about CTP but I don't know why you would bother saying that as it's mandatory for all drivers so kind of redundant.
Unless you're really struggling to make ends meet, it's crazy not to have TPP. It doesn't matter how good a driver you think you are, you cannot account for every driver on the road even if you were to practice defensive driving. I live in one of the poorer suburbs but I see quite a few luxury cars on the road. One day you might be unlucky enough to hit a 100K car or a 500K super sports car. There goes everything you've worked on your entire life.
If you don't have proof or witnesses, it's going to be your word against theirs and someone unscrupulous might claim it's your fault even if it wasn't.
You roll the dice when you drive without at least TPP.
Don’t have a car.
16 years not insured in the past, due to type of car's I drove. Now I drive a regular family car so insured now especially since I dont trust wifes driving style :P Probably would have save 16 to 20k I guess at a minimum.
What car
Does anyone else get annoyed when ppl say 'third party' when they mean 'third party property' ?
Is third party injury insurance compulsory in all states now? Like a greenslip in NSW? I think it is, so people really only have the choice between no property insurance, 3rd part property insurance and comprehensive vehicle insurance, which i am guessing is why it’s often shortened to 3rd party.
Yes 3rd party injury is mandatory in all states
Yes, it is.
But it doesn’t mean everyone takes it out.
Ie. some ppl drive unregistered.
Super hard (in NSW at least) now with auto number plate scanning. Drive past a cop and you'll get caught.
My car is only worth $2-3k and does about 5k km’s per year.
I’ve got third party property only, as comprehensive insurance was more than 50% of the cars value.
how are you getting these gift cards?