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Car Insurance

Car Insurance in New Zealand: Your Ultimate Guide

Car insurance is a vital part of owning a vehicle, providing protection from financial losses due to accidents, fire, theft and more!

Blue Blob

What is Car Insurance?

Car insurance is essentially a contract between you and the insurance company. You pay a premium, and in return, the insurer agrees to pay for specific car-related financial losses during the term of the policy.

What does car insurance generally cover?

The extent of coverage depends on the type of insurance you purchase. It can cover damage or loss due to accidents, theft, fire, or natural disasters. It can also cover injuries to other people and property damage, which can potentially save you from huge out-of-pocket expenses. Anyone who owns a car in New Zealand should consider car insurance to protect against these unpredictable costs.

Who Needs Car Insurance and When?

In New Zealand, while car insurance isn’t mandatory, it’s highly recommended. If you cause an accident and are not insured, you could be held financially responsible for any damage or injury you’ve caused to others.

Common Car Insurance Claims

There are several types of car insurance policies in New Zealand:

Third Party

This insurance covers damage you’ve caused to another person’s vehicle or property, but it doesn’t cover damage to your car.

Third Party, Fire & Theft

In addition to third-party coverage, this policy also covers your car if it is stolen or damaged by fire.


This policy offers the highest level of protection. It covers damage to your own car and other people’s property, as well as theft and other damage.

Common Car Insurance Claims

Let’s look at four different claim scenarios:

Accidental Damage

You accidentally back into a pole, damaging your car’s rear bumper. A comprehensive insurance policy would cover the repair costs.

Blue Claim

You wake up one morning to find that your car has been stolen from your driveway. If you have a third-party, fire, and theft or comprehensive policy, your insurer should cover the cost of replacing your car.

Blue Claim 1
Fire Damage

If your car is damaged due to a fire at your home, a third-party, fire and theft, or a comprehensive policy would cover the cost of repairs.

Blue Claim 2
Third-Party Damage

You accidentally rear-end another car at a traffic light. A third-party or comprehensive policy would cover the repair costs for the other vehicle.

Blue Claim 3

If you want to know whether a specific scenario is covered by your policy, contact us and we can let you know. 

Commonly Asked Questions

There are many things to consider when purchasing car insurance. Here are some commonly asked questions:

What should I watch out for with car insurance?

While purchasing car insurance, it’s crucial to understand the ins and outs of your policy. Here are some key points to consider:

Windscreen Nil Excess

Some comprehensive policies offer a “windscreen nil excess” option. This means that if you make a claim to replace or repair your windscreen or windows, you won’t have to pay an excess (the amount you contribute to a claim). Check if your policy includes this option, as windscreens can be easily damaged and replacements can be costly.

Under 25 Excluded

Some policies exclude or charge an additional premium for drivers under the age of 25 due to the perceived higher risk associated with younger drivers. Make sure you understand whether this applies to your policy, particularly if you or a family member fall into this age category.

Named Drivers Only

Some policies offer lower premiums if you restrict the cover to named drivers only. This means that only the drivers listed on the policy are covered when driving the vehicle. If you have other people who might occasionally drive your vehicle, such as family members, you need to ensure they are included as named drivers on your policy.

Market Value vs Agreed Value

The value of your car as stated in your insurance policy can be either “market value” or “agreed value”. Market value is the estimated cost to replace your vehicle with one of similar make, model, age, and condition. Agreed value, on the other hand, is a value you and the insurer agree upon when taking out the policy. It’s crucial to understand which one your policy uses. If it’s market value, remember that this amount can depreciate over time, which means you might get less than you expect in the event of a total loss.

What regions does car insurance cover?

Most policies cover the whole of New Zealand, this generally also includes travel between the islands whilst on a boat such as a Ferry. 

What is the difference between private car insurance and business vehicle insurance?

Private car insurance covers personal vehicles, while business vehicle insurance covers vehicles used for business purposes.

Is my car insurance covered without a WOF (Warrant of Fitness) or registration?

Insurance policies usually require a valid WOF and registration. Without these, your insurance may be voided.

How long does car insurance last?

Policies are typically annual and can be renewed each year.

What is knock for knock and how does it apply to personal vehicles?

“Knock for knock” is an agreement between insurance companies where each insurer pays for the damage to their own client’s vehicle, regardless of who was at fault. It does apply to personal vehicles if both parties have a comprehensive policy. 

How do I get a car insurance certificate?

You should receive a certificate from your insurer once you purchase a policy. If you haven’t, contact your broker or insurance company.

Buying Car Insurance

The cost of car insurance can vary widely, depending on many factors including the type of coverage, the make and model of your car, and your driving history. It can range from a couple of hundred dollars for a third-party liability-only policy to a few thousand for daily driven exotic cars.

How can I purchase Car Insurance?

In New Zealand, you can purchase car insurance through one of our amazing insurance brokers at Gerrards Insurance Brokers. It’s highly advisable to use a broker because there are many pitfalls that a broker will help you avoid. They will guide you through the process, help you understand the terms and conditions, and find the best cover for your specific needs.

To get started with purchasing the right car insurance for you, get in touch with us at Gerrards Insurance Brokers today. We’re here to ensure you get the best deal and cover for your car insurance needs.

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