Car insurance

Car insurance is not mandatory in New Zealand; however, it is strongly recommended you get some insurance, either comprehensive or third-party.


Comprehensive or third-party insurance
Comprehensive car insurance covers the cost of damage to your own vehicle, as well as other people’s cars and property. This might also include any accidental injuries and/or deaths both in your car and any other vehicles involved in the accident.
Third-party car insurance covers the damage to other people’s cars and property and sometimes injuries and/or deaths in the other vehicles. However, it does not cover the cost of any damages to your own car. For this reason, third party insurance is more affordable.
Third-party car insurance usually has an option to add fire and theft, which means your vehicle is covered if your car is stolen or damaged by fire.


Who is insured?
Car insurance will either cover the driver or the vehicle. Who or what is insured should be pretty obvious in your car insurance policy.
When the insurance covers the driver, this means the driver is insured on any vehicle, whether it’s your own or someone elses. When the car insurance covers the vehicle, this means that just your own vehicle is covered. Nevertheless, that usually means anyone driving your vehicle is also covered.


Make sure that you read the conditions of your insurance carefully, as there are some situations where your insurance may not be valid. It is pointless and a waste of money to buy car insurance if you or your car are breaching the conditions of the insurance policy. For just a few obvious examples, your car insurance is only valid when:

  • The driver has a valid driver licence. Find out what licence is valid in How to Drive in New Zealand
  • The car is used in a safe and roadworthy condition
  • The driver is not under the influence of alcohol or drugs
  • Your vehicle is only used for personal use, rather than commercial or business purposes
  • You have been truthful about your car condition, driving history and who is driving the car


On the wording and policy of your car insurance, you’ll see the word ‘excess’. In insurance terms, the excess is how much of the damages you pay for when making a claim. For example, if you have an excess of NZ$500 and the damages bill is NZ$5000, then you will pay NZ$500 and the insurance company will pay NZ$4500.


What to Do if You Have an Accident?
Before all that, call 111 in an emergency situation.
If you are involved in a vehicle accident, write down all the details about the accident, including name and contact details of the other driver and registration licence number of the vehicles involved. Also, get the names and contact details of any witnesses.
Then contact your insurance company the insurance company will have likely given you a phone number to make a claim.

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