How to Get Car Insurance as a New Driver in Australia

No doubt, getting your first car is exciting. I still remember how excited I was when I bought my first car. I had to call my siblings and friends to break the good news to them. We drove around the streets of Sydney to showcase the new whip. I won’t be surprised if you feel the same way. But before you hit the road, there’s one more step you can’t skip. That step is getting your car insurance policy as a new driver in Australia. 

As one with years of experience in Australia’s insurance industry, I’ve helped new drivers like you understand vehicle insurance. It can feel overwhelming at first, but the process becomes simple once you understand the basics.

In this article, I will break down how to get the best car insurance policy as a new driver in Australia. In addition, I will explain key terms, list top providers, and compare costs by state.

 Whether you’re a P-plater, international student, or young adult buying your first car, this guide is designed to help you make confident, informed choices. But first, let’s discuss what car insurance is.

What Is Car Insurance?

Car insurance is a contract between you and an insurer that covers financial loss from theft, accidents, or damage involving your vehicle. There are four main types of car insurance policies in Australia:

1. Compulsory Third Party (CTP): Also called “Green Slip” in NSW, this is mandatory. It covers injuries you cause to other people in an accident.
2. Third Party Property: Covers damage to other people’s vehicles or property but not your own car.
3. Third Party Fire & Theft: Adds protection if your car is stolen or damaged by fire.
4. Comprehensive car insurance: Covers damage to your car and other vehicles, regardless of who’s at fault.

As a new driver, I highly recommend you go for a comprehensive car insurance policy. Yes, it costs more, but it gives peace of mind.

Why Is Insurance More Expensive for New Drivers?

Insurance for new drivers is generally more expensive because insurers consider them higher risk. According to a 2023 report by the Australian Bureau of Statistics, drivers aged 17–25 are involved in twice as many road incidents compared to older, more experienced drivers.

New drivers lack driving history, which makes it hard for insurers to assess their risk level. That’s why premiums for younger or first-time drivers can be significantly higher.

However, there are ways to lower your premiums, which we’ll cover below.

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Do This to Lower Your Car Insurance Premium as a New Driver in Australia

While you can’t change your driving history overnight, there are still ways to reduce your car insurance costs:

• Add an experienced driver (like a parent) to your policy
• Choose a car with a high safety rating. A car that has an anti-theft device installed will reduce your premium.
• Park in a garage or secure area
• Avoid modifications that increase risk
• Limit your driving distance. Less driving often means lower risk

Over time, safe driving will build your no-claim bonus, lowering your premium further.

Average Cost of Car Insurance for New Drivers by State

Car insurance premiums can vary depending on your location. Here’s a comparison of average annual comprehensive premiums for new drivers under 25:

Note: These are averages and may vary based on vehicle type, postcode, excess chosen, and driving record.

Here’s a comparison of some highly-rated insurers offering good policies for new or young drivers:

Guide to Getting the Best Car Insurance Policy as a New Driver in Australia

1. Understand What You Need

Start by choosing the type of insurance you need. While a compulsory third-party policy is mandatory, a comprehensive car insurance policy is highly recommended for new drivers.

2. Put Your Details Together

Insurers will ask for:

• Your name, age, and licence type
• Vehicle registration and model
• Where the car will be parked
• Your driving history (even if limited)

3. Use Comparison Tools

Use platforms like Compare the Market, iSelect, or Canstar to compare quotes. This helps you find the best value for your situation.

4. Check for Discounts

Many insurers offer multi-policy, driver training, or low-kilometre discounts. Some even reward students with good academic records.

5. Pick a Higher Excess to Lower Premiums

If you can afford to pay more in the event of a claim, a higher excess can significantly reduce your monthly premium.

6. Apply Online or Over the Phone

Most insurers let you apply in 15–20 minutes. Make sure you carefully review your Product Disclosure Statement (PDS) before purchasing.

Why It’s Worth Investing in Good Insurance

Some new drivers are tempted to pick the cheapest policy. However, low-cost insurance may come with higher excess, fewer inclusions, or poor claims service.

Imagine this scenario: You’re driving to work and accidentally hit another car. If you only have third-party property insurance, your policy will cover the other driver’s vehicle but not your own. Without comprehensive coverage, you might end up paying thousands of dollars to fix your car.

That’s why I always recommend starting with comprehensive coverage, even if it means a slightly higher monthly cost.

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Conclusion

Getting a car insurance policy as a new driver in Australia may seem complicated, but it doesn’t have to be. With the right approach, you can find an affordable and reliable cover that protects both you and your car.

To achieve this, start by comparing providers, understanding your coverage needs, and looking for long-term value. Don’t always go for the cheapest price. Over time, as your experience grows and you maintain a clean driving record, your car insurance premiums will reduce.

As a licensed insurance agent, I’m here to help guide you through the process. Because getting insured isn’t just about ticking a box, it’s about having peace every time you’re behind the wheel.