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When it comes to motor (or car) insurance there are many different options, as well as several things to consider. If you’re new to the world of car insurance, it can be quite overwhelming when comparing different insurers and policies. To help, we’ve explained some key car insurance things below.

Motor injury insurance

Compulsory in Western Australia, Motor injury insurance is the minimum level of cover available. Vehicle owners pay a Motor injury insurance premium to cover the cost of injury that they or their vehicles may cause in a crash. The premium is included in the cost of your car registration. For more information, visit the Department of Transport website.

Third party property insurance

This insurance generally covers you for the cost of damage to other people's cars or property – that’s why it’s called ‘Third party’. Ordinarily, Third party car insurance doesn’t cover any damage to your own car, and your vehicle won’t be covered if it is stolen. Third Party Property Damage Car Insurance through P&N Bank does provide you with protection for uninsured drivers. That means if your car is damaged by an uninsured vehicle and it’s agreed you're not at fault, you'll be covered.

Third party insurance could be described as ‘basic’ cover, but as a result it’s likely to be the most affordable when compared to other types of car insurance due to the lower premiums. Before purchasing, we suggest you always weigh up the costs you would have to cover if something were to happen to your own vehicle.

Third party with fire and theft insurance

For a step up from Third party property car insurance, Third Party Fire and Theft Car Insurance through P&N Bank is the cover to consider if you’re looking for mid-level protection. It will generally cover damage you cause to other driver’s vehicles as well as any damage to your own car caused by fire or theft.

This type of insurance can be great if you want to keep your outgoings on budget but like to have extra peace of mind. It may not be suitable for everyone though. If you’re paying off your vehicle through finance or a loan, it’s likely you’ll be required to take out Comprehensive cover instead as part of the sale contract.

Comprehensive car insurance

The highest level of motor insurance coverage available, Comprehensive Car Insurance through P&N Bank covers your vehicle, regardless of who is responsible for the damage. It generally costs more than other levels of motor insurance coverage but gives you the most protection for your set of wheels.

Generally, a Comprehensive policy will cover the repair and/or replacement of your car due to accidental damage, theft, malicious damage, fire, and weather-related damage.  Any other vehicles or property that are damaged because of an incident it’s agreed you’re liable for will also be covered.

Agreed value vs. Market value

When completing a motor insurance quote, you may be asked whether you want to insure your car for an agreed value or the market value. It’s not always a straightforward decision, especially if you’re not an expert in cars and car insurance.

Agreed value is the maximum amount your insurer will pay for any single incident. It’s a set amount that is specified on your policy documents.

Market value is determined at the time of a successful claim and will look at the car sales market to determine how much your vehicle would be worth if it was being sold. Your insurer will generally get this figure from several industry sources.

What can affect Agreed value and Market value?

Agreed value Market value
Vehicle age Vehicle age
Make and model Make and model
Vehicle condition Vehicle condition
Added accessories and modifications Kilometres the vehicle has travelled

When weighing up which option to choose, bear in mind that economic conditions and market conditions will impact the market value of your car over time. Also, if you make modifications to your vehicle once you’ve settled on an agreed value, you may not be covered and will need to adjust your policy to reflect the changes – which could lead to a higher premium.


As with other types of insurance, when purchasing a car insurance policy you’ll have the opportunity to choose your excess amount. Raising the excess amount will usually decrease your premium amount, and vice versa.

Excess is the amount you contribute towards the cost of any insurance claim. For example, if you’re involved in a collision (and your insurer has agreed to cover the damage to your vehicle) and the damage to your vehicle is valued at $5,000 and your excess is $600, you would pay $600, and your insurer would pay the $4,400 to repair your vehicle.

When you’re setting your policy excess amount, remember that you’ll need to be able to have the amount available at the time of a claim. If you’re not sure you would be able to afford a larger amount in one go, you may want to lower the excess amount – and this may raise your premium amount.

The car and the premium

When you’re thinking about buying a car, it’s always a good idea to consider the implications your chosen vehicle could have on your motor insurance premium. Depending on the insurer, the make and model, the car’s security features, how much and where you drive it, where you park it during the day and at night could all affect how much you pay for your insurance.

Your premium will also be affected by your age, how long you’ve had a driver’s licence and the claims history of the main driver. You can check the policy PDS for more information on pricing criteria.


In need of insurance for your trusty set of wheels? We offer three levels of cover to choose from, and you can get a quote online, in minutes. Alternatively, you can give our friendly team a call on 13 25 77. They’re more than happy to help.


Police & Nurses Limited (P&N Bank) ABN 69 087 651 876& AFSL 240701 acts under its own AFSL and under an agreement with the issuer Insurance Australia Limited trading as CGU Insurance ABN 11 000 016 722, AFSL 227681. Any advice provided is general advice only and does not take into account your individual objectives, financial situation or needs (“your personal circumstances”). Before using this advice to decide whether to purchase a product, you should consider your personal circumstances and the relevant Product Disclosure Statement and Target Market Determination.