Ready to finally buy your first vehicle? Depending on your specific financial circumstances, this endeavour could put a tiny ding or significant dent in your bank account. Fortunately, it’s not mandatory to get vehicle insurance in New Zealand so that you can write off that added cost.
However, the Ministry of Transport strongly recommends that you get at least third party insurance coverage, which would cover the costs of damage for a third party’s vehicle if you get into an auto accident.
Motor Vehicle Insurance Types
In general, you could choose among three types of car insurance policies in New Zealand, which includes the following:
- Third Party Property Insurance – The most economical motor vehicle insurance option, this would cover you for various costs of damage your motor vehicle caused to another individual’s property or vehicle. This is the most popular car insurance option for cars that aren’t worth that much since it doesn’t cover costs to repair your vehicle if it gets damaged.
- Third Party Theft and Fire – This car insurance option offers coverage for any damage your vehicle caused to another individual’s property or vehicle. It likewise covers you if your car sustains fire damage or gets stolen.
- Comprehensive Insurance – This option covers everything mentioned above, regardless of who’s at fault, and includes coverage for salvage costs in the event of an accident.
Important Things to Think About
Although the Ministry of Transport only recommends getting the third party vehicle insurance policy, it’s also best that you weigh all the pros and cons of all insurance types, especially if you have the means to afford the more comprehensive options. Regardless of which option you choose to go with, however, you have to make sure whether it’s for your vehicle’s market or agreed value, warns a respected car dealer in Auckland, because this would indicate how much you could recover if your car gets lost or is written off.
Reasonable and fair vehicle insurance is an excellent safeguard for car owners, especially for new drivers or those who have significantly costlier vehicles. You just need to do your research to determine which one fits your needs best.