If you’re ever involved in a collision, you will be asked if you have insurance. The subject of car insurance in New Zealand can be a bit confusing. Mainly if you are a relatively new Kiwi and didn’t grow up understanding the risks and requirements.

There are risks involved in driving without car insurance in NZ. So we thought we’d explain some of the fundamental details. And answer some frequently asked questions about car insurance in New Zealand.

Is insurance mandatory in New Zealand?

Vehicle insurance is not compulsory in New Zealand. However, third party insurance, which insures you against having to personally pay the cost of damage to someone else’s vehicle. Is recommended as a minimum.

What types of car insurance are there in New Zealand?

There are three types of motor vehicle policies:

  1. Third-Party Property Damage: This covers you against the damage you cause to someone else’s vehicle and/or property. It is the least expensive type of car insurance.
  2. Third-Party, Fire and Theft: This covers damage caused by fire and theft to your vehicle. As well as Third Party Property Damage.
  3. Comprehensive: This covers you against accidental loss of, or damage to, your motor vehicle. It also covers you for any damage to other people’s vehicles or property. Whether it was your fault or someone else’s. And for other costs such as salvaging your car from the accident scene and towing it to a repairer. As well as the standard policy, companies offer a wide variety of options and benefits. Generally, the more extensive the cover, the more expensive the policy.

What happens if a collision or car accident is your fault?

Generally speaking, the person who accepts responsibility for an accident will pay for the repairs. If you are insured, your insurance company may pay, depending on the type of insurance you have. If the other person is at fault but has no insurance, they are liable to pay for the damage. However, your insurance company may allow you to make a claim to cover the costs.

Even if the accident was not your fault. If you accept responsibility for the accident but you do not have insurance. You will need to pay for the repairs privately. This is not a situation you want to be in. Hence, we always advise drivers to have insurance. At the very least, third party insurance. Car accidents are horrible, but our collision repairs are here to help.

Where does ACC come into it?

Kiwis are covered by ACC, a publicly funded accident compensation scheme that was introduced in 1974. It was introduced to minimise the impact of injury. And provide assistance with the cost of treatment and rehabilitation for all personal injuries, regardless of fault. As well as to do away with the need to sue for compensatory damages.

If you are injured in a car accident or collision. You may be able to make an ACC claim to help with the consequences of your injury. (Therefore, eliminating the need to sue the other party, as happens in other countries).

Are you insured if you drive someone else’s car?

This depends on several factors. Including whether you have your own insurance policy and whether they have theirs. Some policies will cover accidents made by other drivers; some will not. Sorry, there is no clear answer here as it is not an NZ legal stipulation. It depends on the insurance company and policy you have.

What happens if you drive without insurance in NZ?

It’s simply not worth it to drive without insurance in New Zealand. The likelihood of being involved in a collision is high. For instance, a survey done in 2020 by AA Insurance found 63% of Kiwi drivers have had an accident. And 65% of those have had one or more accidents before they turn 30.

Therefore, knowing that the chances of being involved in a collision are high. It’s important to realise that the financial implications of having an accident without insurance are often greater than the cost of insurance.

If you cause an accident and you don’t have insurance. You may be liable to pay for the damages to the other car involved. Additionally, you will also have to pay for the damage to your own vehicle. (Third-party insurance only covers the damage you cause to another vehicle).

According to AA Insurance, numerous young Kiwi drivers are paying off debt accumulated through car repairs due to driving without insurance. Some examples include people in their twenties who owe upwards of $20,000. Comparable to student loans. Simply because they decided that paying for car insurance wasn’t worth it.

Can my panel beater deal directly with my insurance company?

Our panel beaters directly deal with all the leading insurance companies in New Zealand. We can help with providing insurance advice such as making a claim or what actions you can take. Our trusted relationships with them, along with our experience and accreditation. Help us ensure your vehicle will be restored according to the applicable provisions of your insurance policy.

If you have any questions at all, please feel free to give us a call on 0800 227 762. We can answer any questions you may have.

Please note, the information published here was accurate at the time of publishing. It is not intended to serve as financial or legal advice. Please contact your insurance company for the most up-to-date legal requirements regarding vehicle insurance where you live.

The Mt Roskill Collision Centre promise

Our goal is to have everyone on New Zealand roads driving safely. We offer a lifetime guarantee on our car repairs from our panel beating and collision repair service centre in Mt Roskill, Auckland. Contact us online or call us on 0800 227 762 for a free quote or to book an appointment.