It costs more to insure your car in Sydney than Melbourne

RateCity's study on Melbourne comprehensive car insurance premiums could encourage you to compare now before you renew your next policy.

When it comes to comprehensive car insurance, almost everyone could be charged a different price. The amount we pay can be determined by our age, the type of car we drive, our driving history and where we live. But the insurance company we decide to trust with our policy is another variable. So when it comes to finding the right provider, does it really pay to compare online?

RateCity recently put the spotlight on Melbourne, as part of its bi-annual review on comprehensive car insurance, which showed that Melbourne drivers could be paying $1000 more on average for their comprehensive car insurance.

The average cost for Melbourne drivers in the study was $960, which is $174 less than Sydney's average cost of comprehensive car insurance ($1134) for the same driver profile across four different suburbs.
The Melbourne study compared 26 car insurance companies across four different suburbs in Melbourne (Doncaster, Seddon, Meadow Heights and Caulfield) with the following results:

Meadow Heights paid the highest premium overall with an average cost of $1082.72. It also included the biggest gap between the lowest and highest cost of cover of almost $1500 or 71 percent difference.
Drivers in Doncaster paid the lowest for their comprehensive car insurance, at an average of $906.04. The difference between the cheapest and most expensive premiums was $800.10.
The cheapest premiums were all from online-based businesses including Bingle, Budget Direct, Youi and The Buzz.
The most expensive quotes were from some of the biggest players in the market including AON, Suncorp, CGU and St George Bank.
"It is hard to understand how the difference in price for the identical driver profile with the same address can have such varying degrees of car insurance quotes," RateCity CEO Damian Smith said.
"But what this means is that there is a lot of money to be saved by most drivers and the easiest way to get the best deals is by shopping around and comparing car insurance online."
Smith said features and services may vary between insurance providers so make sure you read the product disclosure statements carefully before signing up.

"There are obviously many other features besides price that drivers should think about, and we encourage drivers to look closely at all aspects of an insurer's offering," Smith said.

So whether you live in Melbourne or Sydney or any other part of Australia, there is a lot of money you can potentially save by comparing car insurance online.

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Drivers comparing car insurance online beat rising premiums

Car insurance premiums are expected to rise in 2010 as a result of insurers compensating for lost profits in 2009. However, as new competitors enter the market, Australians who shop around for car insurance will be sure to find better offers.

Major insurance providers such as Suncorp-Metway and Insurance Australia Group took a beating to their earnings last year after successive payouts for natural disasters claims, resulting from bushfires and heavy storms.

With three-quarters of the market share between them, these losses are sure to be felt by customers, who are expected to see car insurance premiums rise by 5 percent in 2010.

However, many competitors have fixed their eyes on Australia’s car insurance market, with Virgin Money entering the fray last year. And from the United States, Progressive Direct Insurance Co. is planning to launch its online motor vehicle insurance business to tap into the growing trend of Australians who compare their car insurance and other personal finances on the internet.

By focusing on the online market, competitors avoid the costs of directly competing against the insurance giants, meaning that savings made can be passed on to consumers in the form of cheaper rates.

More and more people in Australia are using the internet to shop for car insurance, with 68 percent of customers applying online and 75 percent searching for car insurance online, a Google survey found. As this trend continues, we will likely see more drivers purchasing and managing their policies over the net as well. Experts also believe that Australia’s disposition to compare car insurance online will attract many more foreign competitors in the future.

A recent study by RateCity showed that many drivers can save up to $800 on their comprehensive car insurance by switching to the most affordable providers. This means that if consumers stay vigilant for offers from competitors trying to break into the market, the savings made could go well into the thousands of dollars.

By joining the thousands already applying for car insurance online, Australian drivers can also take advantage of hundreds of special discounts offered to customers who sign up over the net, adding to the savings made in their yearly insurance costs.

The insurance giants are standing their ground in the market, but wise shoppers can always find the cheapest deals by conducting a quick quote online. By searching for new offers and comparing prices across all the competitors, you can drive knowing that you have the best cover for your vehicle. By Jack Han

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