Car Insurance Companies in Australia
Choosing the right car insurance company in Australia can feel overwhelming. The market is crowded with national brands, regional providers and niche insurers that offer a range of products from basic third-party cover to fully comprehensive policies with extras such as roadside assistance and rental car cover. This article walks you through the major players, how premiums are set, what to watch for when buying a policy, and practical tips to reduce your costs. It also includes expert commentary and clear, colourful tables that show market share and average premiums across states to help you compare options at a glance.
Why understanding the insurance market matters
The car insurance landscape directly affects what you pay and how quickly a claim is paid when an accident happens. In 2023 the Australian Bureau of Statistics and industry reports showed motor insurance remains one of the most contested product lines, with insurers collectively writing more than AUD 14 billion in gross earned premium. That means choices made by consumers ripple through the industry and shape underwriting and pricing practices.
For most households, car insurance is an essential recurring expense. The national average for comprehensive car insurance in 2024 is around AUD 1,450 per year, but that figure varies significantly by state, age, vehicle type and driving history. With changes to repair costs, parts supply and accident rates, premiums have been moving year-to-year, which is why comparing companies and understanding policy details is so important.
Who are the major car insurers in Australia?
The Australian car insurance market is dominated by a handful of large groups and a number of competitive niche players. Industry consolidation has left a few organisations controlling large slices of the market, while specialist brands focus on particular demographics or price points. Below is a practical overview of the major names you’ll encounter and what each is broadly known for.
IAG (Insurance Australia Group) is the largest player and owns multiple brands such as NRMA, AAMI and CGU. IAG’s combined market share is sizeable, often cited between 30 and 35 percent of the market. Suncorp Group, which houses brands like Suncorp, Vero and AAMI in some regions, typically holds around 18 to 22 percent. QBE Insurance, Allianz Australia and other global insurers maintain a meaningful presence, with QBE around 8 to 10 percent and Allianz around 6 to 9 percent. Several regional mutual insurers such as RACQ, RACV, RACT and APIA cater to state-based customers with strong local recognition.
Smaller and newer entrants such as Youi, Budget Direct and several online-only insurers compete aggressively on price and digital service. Telematics-based providers and usage-based products are reshaping the market by offering discounts to safer drivers.
Market share snapshot
To make the distribution of market share easier to digest, the table below highlights the approximate market shares of the major companies and groups. These figures are indicative and aggregated from insurer filings and industry reports as of mid-2024.
| Insurer / Group | Estimated Market Share (2024) | Notes |
|---|---|---|
| IAG (NRMA, AAMI, CGU) | 30%–34% | Largest group by premium, broad national distribution |
| Suncorp Group (Suncorp, Vero) | 18%–22% | Strong presence in Queensland and NSW |
| QBE | 8%–10% | International insurer with a solid Australian footprint |
| Allianz | 6%–9% | Known for high customer satisfaction in some product lines |
| Regional Mutuals (RACQ, RACV, RACT, etc.) | 6%–8% (combined) | Strong regional loyalty and localised services |
| Online & Niche (Youi, Budget Direct, Others) | 10%–14% | Competitive pricing and digital-first experiences |
These ranges reflect the fluid nature of the market. Acquisition activity, product innovation and changes in pricing strategies can shift the balance over relatively short periods.
How insurers price your policy
Insurers calculate premiums using a mixture of actuarial models, market strategy and regulatory constraints. Several well-known factors drive the price you pay. Your age and driving history have a significant impact: younger drivers and those with at-fault accidents will see higher premiums. The make and model of your car, and its year, determine the repair cost and replacement value, which insurers use to set base premiums. Where you live matters too. Urban areas with high theft or crash rates, like parts of Sydney and Melbourne, typically attract higher premiums than quieter regional areas.
Other important elements include the type of cover you choose—comprehensive cover is the most expensive but also the most protective—your chosen excess, and optional extras such as rental car cover or agreed value for classic cars. Insurers also use telematics or “black box” data, loyalty discounts, multi-policy discounts and claims history to refine pricing. For example, multi-policy discounts typically range from 10 to 25 percent depending on the insurer and the number of products bundled. Telematics can reduce premiums by 10 to 25 percent for consistently safe driving.
Professor Alan Murray, a specialist in insurance economics at UNSW, observes, “Actuarial models today incorporate much more granular data. Things like localised crash patterns, repair shop capacity and even supply chain constraints for parts are now embedded in pricing. That means premiums are increasingly sensitive to short-term dynamics as well as long-term trends.”
Average premiums by state
Premia differ notably by state and territory. The table below provides a snapshot of average annual comprehensive premiums in 2024 for private passenger cars. These are approximations based on insurer quotes and aggregated industry data, intended to illustrate relative differences rather than exact prices for any single driver.
| State / Territory | Average Annual Premium (Comprehensive) | Typical Range |
|---|---|---|
| New South Wales | AUD 1,520 | AUD 1,000 – AUD 2,600 |
| Victoria | AUD 1,460 | AUD 980 – AUD 2,400 |
| Queensland | AUD 1,380 | AUD 900 – AUD 2,200 |
| Western Australia | AUD 1,350 | AUD 850 – AUD 2,100 |
| South Australia | AUD 1,240 | AUD 800 – AUD 1,900 |
| Tasmania | AUD 1,140 | AUD 750 – AUD 1,700 |
| Australian Capital Territory | AUD 1,300 | AUD 820 – AUD 1,900 |
| Northern Territory | AUD 1,680 | AUD 1,100 – AUD 2,900 |
These state averages reflect the influence of theft and accident rates, repair capacity, and local insurer footprints. For instance, the Northern Territory average is higher due to higher claims costs per policy owing to longer distances and heavier machinery involvement in some incidents.
Typical claim costs and processing times
Understanding how much insurers pay on average and how long claims take helps set expectations. The average comprehensive motor claim payout in 2023 was approximately AUD 7,400, with repairs for minor collisions often costing between AUD 2,000 and AUD 5,000, while write-offs and major structural repairs can exceed AUD 20,000. Glass-only claims are typically much cheaper and are often processed faster.
Processing time depends on the complexity of the claim. Straightforward repair claims are frequently settled within 5 to 15 business days if there is agreement on liability and repair arrangements. More complex claims involving multiple parties, injury assessments or investigations can take 30 days or longer to finalise. AFCA’s complaint statistics indicate that most disputes arise from delay, disagreement over fault and differing views on repair versus write-off decisions.
Sarah Li, Head of Claims at Allianz Australia, explains, “We aim to have simple repair claims resolved within 10 business days. Complex matters need more time because we must coordinate assessments, parts availability and, where relevant, legal liability. Where a customer requires a rental vehicle, we prioritise resolving the immediate mobility need while working on the final settlement.”
What to watch for in policy wording
Policy wording matters. Two policies that both claim to be comprehensive may deliver very different outcomes once a claim is lodged. Key areas to examine include the definition of “agreed value” versus “market value,” the handling of replacement parts (OEM versus aftermarket), whether roadside assistance and rental cover are included or optional, and any exclusions for named drivers or modifications to the vehicle. Also inspect the excess structure. A lower premium may simply reflect a much higher compulsory excess, which could be costly in the event of a claim.
Additionally, check the policy’s sub-limits for items like audio equipment and personal belongings. Some policies will offer a higher payout for certain accessories if they are declared at purchase, while others cap the amount considerably. The cooling-off period, typically 10 to 14 days, allows you to cancel after purchase with a refund but make sure you are within your rights under the insurer’s terms before cancelling.
Discounts and ways to lower your premium
There are several legitimate levers you can use to reduce your premium without sacrificing necessary cover. Increasing your voluntary excess, when you can afford it, will usually lower the premium. Choosing a car with a lower theft and repair profile can make a huge difference; insurers price some models much higher due to parts costs and claims history. Maintaining a good driving record and using telematics can provide discounts for safe behaviour. Bundling home and car insurance with the same provider commonly generates a multi-policy discount. Some insurers also offer loyalty discounts, although these can vary and are not guaranteed to beat market offers available to new customers.
Mark Reynolds, an insurance analyst at Canstar, advises, “Do not fall into the trap of equating price with value alone. A small saving at renewal might come at the cost of poorer cover or higher excesses. Consider the likely claim scenarios for your situation and choose a policy that balances cost with the protection you actually need.”
Niche products and newer entrants
The market has seen growth in usage-based and pay-per-kilometre models, particularly attractive to low-mileage drivers. Telematics devices and smartphone apps monitor driving behaviour to provide personalised premiums. These products often benefit younger drivers or those who can clearly demonstrate low-risk driving habits. At the same time, insurers that specialise in classic cars or high-performance vehicles offer tailored agreed value products that protect the unique needs of these owners.
Tom Nguyen, founder of DriveSafe Telematics, notes, “Telematics has matured. The data quality and algorithms now allow insurers to fairly price risk at a granular level. For many low-mileage and safe-driving customers, savings of 15 to 30 percent are realistic when compared to standard quotes.”
How to compare insurers effectively
Comparing insurers should go beyond the headline premium. Check coverage details, excesses, the reputation for customer service, how the insurer handles repairs and whether they use preferred repairers, and average claim turnaround times. Look up AFCA complaint statistics and industry customer satisfaction surveys for additional context. Getting multiple quotes is essential because different insurers weigh risk factors differently. When comparing, ensure you are comparing identical cover levels and excesses to get a true apples-to-apples view.
Dr. Emily Harris, a consumer finance researcher at the University of Melbourne, advises consumers to “read the Product Disclosure Statement closely and pay attention to the exclusions. Many disputes arise from misunderstandings about what is covered—particularly around modifications, business use, or off-road activities. Seek clarification in writing before you sign.”
Common pitfalls to avoid
A frequent mistake is underinsuring by choosing the cheapest premium without assessing policy gaps. This approach can leave you exposed to out-of-pocket costs for incidentals not covered by your policy. Another common error is failing to declare modifications or additional drivers, which can void a claim. Not updating your policy after a significant life change—such as moving to a different address, sharing a car with a family member, or using the car for work—can invalidate cover in certain circumstances. Finally, simply assuming your insurer will provide a rental car or roadside assistance without checking the fine print can create unexpected inconvenience and cost.
Claims examples and realistic costs
To make the stakes clearer, consider the following realistic scenarios. A minor bumper and panel repair after a low-speed collision might cost around AUD 3,200 including parts and labour, which is often well within the average excess if you chose a high voluntary excess. A side-impact with multiple panels damaged and a bent chassis could cost upwards of AUD 18,000 to repair or may be a total loss if the vehicle is older, in which case market value payout applies. Theft and total theft claims for late-model cars can result in payouts of AUD 25,000 to AUD 45,000 depending on the vehicle’s market value.
These examples show why some consumers opt for agreed value cover for newer or modified vehicles, which locks in a payout amount rather than leaving it to market value, which can be lower than expected after depreciation and damage considerations.
Regulation and dispute resolution
Australian insurers operate under stringent regulatory oversight. APRA (Australian Prudential Regulation Authority) monitors the financial soundness of insurers to protect policyholders. ASIC (Australian Securities and Investments Commission) and the Australian Competition and Consumer Commission (ACCC) also play roles in oversight of conduct and competition. For disputes, the Australian Financial Complaints Authority (AFCA) provides an independent avenue for resolving complaints between customers and financial firms. AFCA’s reports show that motor insurance disputes are typically about delays, disagreement over fault and shortfalls in settlement amounts.
When a dispute arises, collect as much evidence as possible, including photos, police reports, witness details and correspondences with repairers and the insurer. Keeping a detailed timeline and receipts for expenses such as taxis or towing can support your case. If you feel unsatisfied by the insurer’s internal review, lodging an AFCA complaint is the next clear step and often yields a resolution without the need for costly legal action.
Evaluating insurer financial strength and reliability
Financial strength matters because it indicates the insurer’s ability to pay claims, particularly after major events such as widespread storms or bushfires. Credit rating agencies assign ratings to many insurers and groups. Companies with stronger ratings, often backed by global parents or large balance sheets, are generally better positioned to absorb major catastrophic claims. However, strong financials do not guarantee excellent customer service, and smaller insurers can deliver a superior customer experience despite lower scale.
When assessing reliability, look at customer satisfaction scores from independent surveys, the average claim processing times published by the insurer, and AFCA complaint volumes relative to market share. These practical indicators often reveal more about day-to-day performance than a balance sheet alone.
Special considerations for business and fleet owners
Business vehicle insurance and fleet policies require different considerations. Fleet policies take into account the number of vehicles, usage patterns, driver training programs and loss prevention measures. Insurers may offer risk management services to large corporate clients and discounts for telematics or safety training. For small businesses, it is important to explicitly declare business use, because usage exclusions can lead to claim denial if the insurer believes the vehicle was used primarily for work and this was not disclosed at inception.
Insurers also price based on the exposure window. For example, couriers and tradespeople who use their vehicles extensively during peak hours present a higher risk than a sales representative who uses a vehicle intermittently. Accurate declaration keeps the policy valid and ensures claims are handled smoothly when needed.
How to switch insurers without losing benefits
Switching insurers can generate immediate savings, but doing it without losing benefits such as no-claims bonus requires care. Many insurers recognise no-claims histories when you provide a statement from your previous insurer. Timing is important: avoid lapses in cover by arranging the new policy to start the day the old policy ends. Also, check whether your current insurer will refund unused premium on a pro-rata basis if you cancel mid-term—this is common but terms vary. Ensure you obtain written confirmation of any transfer of no-claims recognitions or loyalty credits.
Future trends shaping the market
Several trends will continue to shape the Australian car insurance market. Telematics and usage-based pricing will expand as data improves and privacy frameworks settle. Replacement costs for parts and labour—affected by global supply chains—will remain a major influence on premiums. Climate-related factors such as more intense storms and bushfires are already affecting claim frequency and severity, and insurers are adapting both their underwriting approach and risk mitigation services. Finally, digital claims handling and automation will speed up simple claims but will also raise expectations for instant responses and clear communications.
Mark Reynolds adds, “Expect insurers to offer more proactive products focused on risk reduction. That includes smarter telematics, partnerships for better repair logistics and targeted discounts for drivers who accept behaviour-driven monitoring.”
Practical checklist before you buy
Before committing to a policy, there are practical questions you should clear up. Ensure you understand whether the cover is agreed or market value, what is included under comprehensive cover, which extras are optional, the amount and structure of excesses, and how claims are handled. Confirm whether any special endorsements or exclusions apply for modifications, business use or named drivers. Ask about the availability of preferred repair networks and expedited claim options if you need a rental vehicle. Finally, compare multiple quotes and obtain the Product Disclosure Statement from each insurer so you can read the fine print.
Expert voices
Four industry experts offer additional perspective. Professor Alan Murray of UNSW explains that “Price sensitivity in the market means consumers have more choices, but it also pressures insurers to optimise underwriting, sometimes leading to tighter exclusions. Read the policy.” Dr. Emily Harris from the University of Melbourne recommends that “consumers get multiple quotes and check AFCA complaint trends when evaluating insurers; complaints per thousand policies highlight recurring service issues.” Sarah Li, Head of Claims at Allianz, advises, “Take photos and document everything if you have an incident; quick evidence speeds up claims and reduces disagreement. If you need immediate mobility, notify us early to arrange a rental.” Tom Nguyen of DriveSafe Telematics adds, “If you drive less than 10,000 kilometres a year consider telematics products; they can be materially cheaper for low-risk drivers.”
Conclusion: balancing cost and protection
Car insurance in Australia offers a broad range of options, from economy policies to premium products with extended benefits. The right choice balances cost, the scope of cover, and the insurer’s track record for handling claims. Use the tables and figures in this article as a starting point to understand market structure and average costs, but always obtain multiple personalised quotes for the most accurate comparison. Read the Product Disclosure Statement carefully, ask questions about any exclusions or sub-limits, and consider telematics or multi-policy bundles if those options match your situation.
With careful comparison and a clear understanding of your needs, you can secure cover that provides peace of mind without paying for protection you won’t use. The industry offers tools and competitive products that, when used wisely, can significantly reduce your overall insurance expenditure while maintaining robust protection when you need it most.
Source: