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Travel Insurance
New Zealand Travel Tips & Questions

Do I need car insurance?

The incredibly short answer is no - car insurance is not a legal requirement in New Zealand. But before you start celebrating at some money saved you might like to know a few facts.

If you are involved in an accident in New Zealand in which you were at fault and have no insurance cover you will have to pay for any vehicle repairs or replacements for the other parties as well as compensations for any injuries caused. Even in quite minor cases this can run to thousands of dollars. In more serious cases you will be dealing with figures with more zeros on than you can count. Driving in New Zealand can be extremely challenging and having some kind of accident although usually minor is relatively common. In fact around 1 in every 3 New Zealand visitor insurance customers make a claim on their insurance every year.

Transversely, paying the premium for insurance cover - which of course you may never need to claim on - plus having to pay any excess in the event of an accident may seem like too much of a financial risk. The bottom line is only you can make that decision.

In case you need a little more information before making a decision the following is also worth knowing:

  • There are 2 different categories of insurance – comprehensive and third party. Comprehensive covers both the cost of your own and other vehicles involved in an accident. The typically cheaper third party only covers damage to the vehicles of others but not your own although you can usually add a fire and theft cover to this which means you will be reimbursed if your vehicle is stolen or damaged by fire.
  • Policies exist to cover either the driver or the vehicle. If you choose a driver-based policy you will have insurance protection in place no matter what vehicle you are driving. If the policy is vehicle-based anyone who drives your vehicle with your consent is also covered.
  • Excesses - the amount you will have to pay out of any overall bill for repairs - vary significantly from policy to policy. Typically, the cheaper the policy the higher the excess.