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Please see information on Insurance below.
- Car Insurance Information
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What is Insurance?
Taking an insurance policy means you are transferring risk. You make an agreement with an insurer, that if you suffer a loss (the type of loss is defined within the contract), the insurer will compensate you.
So, if you do suffer a loss – say an injury after an accident – you won't have to pay for it yourself. There are many different types of insurance in Australia, as well as areas to cover – your car, yourself (health), home and when you go away (travel).
What is Premium?
Premium is the amount that you pay for insurance. Simply put, it is the insurer's cost of providing cover for 12 months. Premium varies according to the type of insurance you need and you might be able to pay it in monthly instalments.
What are the Costs?
Aside from premium (which varies according to insurer, insurance policy and cover type), you will be charged for stamp duty and GST on your insurance.
There may be additional charges from your insurer, such as admin fees – find out what these are.
What is Excess?
Excess is the amount you have to pay for each incident if you need to make a claim. The excess is deducted from the amount of cover you have on your policy, then either paid back to you or used to pay for repairs, supplier or even the insurer.
What is an "Event"?
We hope it never needs to happen, but one day you might need to make a claim. This is called an "event" – something that has happened, such as an accident or damage to property.
Not surprisingly, an event must take place within the period of your insurance policy and must not happen with intention (you didn't damage your car on purpose).
Which events are covered depends on your policy – you will need to make sure that the insurance you take covers you adequately.
How do you get a Quote?
Most insurance companies offer a 'free' or 'no obligation' quote. In order to receive a quote they will need some information from you about yourself and what you want to insure.
Once you have received a quote you can usually take time to think about it. Even once you have signed up and paid for an insurance policy you might receive a 'cooling off' period which allows you to cancel the policy within a certain amount of time (usually a couple of weeks).
What are the Benefits of Insurance?
Insurance is essential to large corporations and companies, because it covers them for damages that might lead to loss of business. If you are a bakery and your oven breaks, you might lose business because you cannot bake bread to sell!
For regular Australians, insurance covers them for those things which affect daily life – car insurance in case you are involved in an accident, or home contents insurance in case your home is burgled. Spreading risk and knowing that you won't need to make a large and unexpected payment in case an 'event' occurs.
Are there any Disadvantages to Insurance?
Some people might feel that taking insurance is paying for something which might never happen, but the unfortunate fact is that unexpected events do occur. It may not be a major road accident, but if you have kids you might be glad that your property or rental property are covered for the mishaps they can create!
The only disadvantages you might experience are policies which don't cover you adequately or are not of good value. Make sure you really look around to get the best offer – and are covered fully for those things which you want to be covered for.
Please Note: www.whichwaytopay.com.au is not authorised to give advice under the ASIC (Australian Securities & Investments Commission).
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