Car Insurance Cost in Australia 2026: Average Premiums by State and Age

The average Australian pays about $2,226 a year for comprehensive car insurance. But that single number hides an enormous spread: a driver over 50 in Tasmania might pay $1,260, while a man under 25 in Victoria can be quoted more than $3,000 for the same level of cover on a similar car.

The gap that should bother you most is not between states or ages. It is between what you pay and what you could pay. Canstar’s research found the average driver on a market-average policy pays $692 a year more than someone on an equivalent five-star-rated policy. For a family with a young driver, the gap is over $1,000 a year — for the same cover.

Australian premiums jumped 30.5 per cent in 2024 and another 6 per cent in 2025. If you have auto-renewed for the last three years without checking, you are almost certainly paying well over the odds.

Estimate your car insurance premium

Pick your state, age band, cover type, excess and roughly what the car is worth. The estimator is built from Canstar’s 2025 Star Ratings averages and shows both the typical market price and what the same cover costs if you shop properly.

Car insurance cost in Australia at a glance

Average car insurance cost by state

Where you live is one of the biggest single factors in your premium, and the spread is wider than most people expect. A Victorian driver pays 65 per cent more than a Tasmanian for comparable cover.

Victoria and New South Wales sit at the top for reasons that have little to do with driving standards: dense metropolitan traffic, higher vehicle values, expensive repair labour, and in Victoria’s case a run of hail and storm claims. Tasmania and South Australia benefit from lower congestion, cheaper vehicles and fewer catastrophic weather events.

How much car insurance costs by age

Age is the other heavyweight. Insurers price on claim likelihood, and drivers under 25 make more claims and more expensive ones. A man under 25 pays 2.4 times what a driver over 50 pays.

One counter-intuitive finding: it was older drivers who copped the biggest increase in 2025, up 6.51 per cent for the over-50s. Being a low-risk driver does not insulate you from market-wide repricing, which is exactly why the “I have never claimed, so my renewal must be fair” assumption is expensive.

Does gender really change the price?

It does, but less than people assume, and not always in the direction you would guess. Comparing 34-year-old men and women in NSW with identical assumptions, men paid an average of $79 more a year — $1,660.79 against $1,581.80. The spread between insurers was far larger than the spread between genders: some providers charged women up to $20 more, others charged men up to $191 more. Which company you pick matters more than your gender.

The four types of cover, and what they actually do

Australians routinely mix these up, and the confusion is expensive in both directions — people buy cover they do not need, or discover after a crash that they were never covered at all.

When comprehensive stops making sense

There is a genuine crossover point. If your car is worth $4,000 and comprehensive costs $1,200 a year with an $850 excess, you are paying almost a third of the car’s value annually to protect a payout that is barely more than three years of premiums. At that point third party property, or third party fire and theft, is the rational choice — and the money you save is better held as a repair fund. The usual rule of thumb: once the annual premium plus excess approaches a quarter of the car’s market value, run the numbers seriously.

CTP insurance and green slips: how it works in your state

Compulsory Third Party insurance is the one policy you cannot legally drive without, and it is handled completely differently depending on which side of a state border you live on. This is the single most confusing part of insuring a car in Australia, particularly if you have moved interstate or arrived from overseas.

Want the full picture? We break down every state’s scheme, the at-fault versus no-fault difference and the claim deadlines in our complete guide to CTP insurance and green slips.

Two things follow from that table. First, in NSW, Queensland, South Australia and the ACT you can shop for CTP and save real money — and most people never do, because it feels like a government charge. In Victoria, WA, Tasmania and the NT there is nothing to compare; the price is the price.

Second, NSW is the only state where you must arrange CTP as a separate purchase before you can register. New arrivals and people moving from Victoria are regularly caught out by this. The NSW average green slip was around $458 in July 2025, premiums have risen about 12.4 per cent since 2022, and insurers filed further increases for policies starting from 15 January 2026.

At-fault versus no-fault matters more than the price

In Queensland, South Australia and Western Australia the CTP scheme is broadly at-fault: if you caused the crash, you generally cannot claim compensation for your own injuries through CTP. In Victoria, Tasmania, the NT and to a large extent NSW and the ACT, no-fault benefits mean injured people receive defined medical and income support regardless of who caused the accident. If you live in an at-fault state and would struggle without an income after a serious injury, that is a genuine argument for income protection cover — a gap most drivers never realise exists.

What actually drives your premium

Insurers are not pricing your character. They are pricing the probability and cost of a claim. Every question in a quote form maps to one of those two things.

Agreed value or market value?

This choice appears in every comprehensive quote and is poorly explained almost everywhere.

• Market value means the insurer pays whatever the car was worth the moment before it was destroyed. It is cheaper, and it is the sensible default for an ordinary car that depreciates predictably. The risk is that “market value” is the insurer’s assessment, and you may disagree with it at the worst possible moment.
• Agreed value locks in a figure now, written on the policy. It costs more, but you know exactly what you would receive. It is worth paying for on a car with a loan against it, a low-kilometre or unusual vehicle, a classic, or anything where the automated valuation guides will understate what you would have to pay to replace it.

The practical trap: if you have a loan and choose market value, a write-off can leave you owing the lender more than the payout — the gap between the loan balance and the car’s depreciated value. That gap is real money out of your pocket for a car you no longer own.

Excess: the number that decides whether you claim at all

The excess is what you pay towards your own claim. Raising it from $500 to $1,500 typically cuts the premium by around 20 per cent — but the catch is that several excesses can stack on a single claim.

• Basic excess — the amount you chose, usually $500 to $1,500.
• Age or inexperienced driver excess — commonly $400 to $1,600 extra if the driver at the time was under 25 or newly licensed. This applies even when they are listed on the policy.
• Unlisted driver excess — charged when whoever was driving is not named on the policy.
• Windscreen or specific-event excess — sometimes waived if you pay for glass cover.

New to Australia? Read this before you get a quote

If you have arrived in the last few years, the pricing system is stacked against you in ways nobody explains, and there are specific moves that get the price down. This section exists because the comparison sites have no commercial reason to write it.

Your overseas no-claim bonus may transfer — ask

Australian insurers build much of your price around no-claim bonus: years of driving without an at-fault claim. Arrive with no local history and you are usually rated as a brand-new driver, even at 40 with two decades of clean driving behind you. That single classification can cost $600 to $1,200 a year.

Several Australian insurers will recognise an overseas no-claim history if you can evidence it — but almost none volunteer this, and it is rarely on the quote form. Before you leave your previous country, or by emailing your old insurer now, get a written no-claims letter on company letterhead stating how many consecutive years you held a policy and that you made no at-fault claims. Then ring Australian insurers and ask directly whether they recognise overseas driving history. The answers vary a lot between companies, which makes it worth several calls.

Driving on an overseas licence

You can generally be insured while driving on a valid overseas licence during the period your state permits you to use it, but you must declare the licence type and how long you have held it. Some insurers price an overseas licence higher, some decline it, and some are neutral. Never let a broker record you as holding an Australian full licence when you do not — a claim will be assessed against what you declared.

Once you convert to an Australian licence, the clock on your Australian driving history starts. Converting sooner rather than later is quietly one of the better financial moves a new arrival can make, because the licence-held duration feeds directly into pricing.

Temporary residents and students

A temporary visa does not prevent you buying comprehensive cover. What trips people up is the address and garaging question: insuring a car at a share-house address in a high-theft inner suburb is materially dearer than at a suburban address with off-street parking, and the postcode you nominate must be where the car actually sleeps most nights. Getting this wrong to save money is misrepresentation, and it is the sort of thing an insurer checks after a theft claim.

How to cut your premium, in order of impact

The Canstar research gives an unusually clear picture of where the money is. Shopping around is not one lever among many — it dwarfs everything else you can do in an afternoon.

• Never auto-renew. This is worth more than every other tip combined. Insurers price renewals on the assumption you will not check. Get three fresh quotes every single year, including one from your current insurer as a new customer — the new-customer price is frequently lower than your renewal for identical cover.
• Ring and say you are leaving. Retention teams have discounts that never appear on a renewal notice. It costs ten minutes.
• Pay annually, not monthly. Monthly instalments commonly carry an effective surcharge of 10 to 20 per cent. If cash flow allows, paying up front is a guaranteed return you will not beat elsewhere.
• Raise your excess — deliberately. Going from $500 to $1,500 cuts roughly 20 per cent, but only do it if you could actually produce $1,500 tomorrow.
• Restrict or remove young drivers. Listing an under-25 can add over $1,000. If they only drive occasionally, check whether the unlisted-driver excess is cheaper than listing them permanently.
• Choose market value over agreed value for an ordinary depreciating car with no loan against it.
• Take the low-kilometre option if you qualify. Many people drive far less than they estimate; check your last two services for real odometer readings rather than guessing.
• Bundle home and car only if the bundled total genuinely beats two separately shopped policies. Often it does not.
• Ask about occupation and membership discounts. Some insurers discount for certain professions or motoring-club membership.
• Buy the boring car. Repair cost and theft appeal are priced in. Two cars of identical value can differ by hundreds a year.

Why premiums have risen so much

Australian car insurance rose 30.5 per cent in 2024 and a further 6 per cent in 2025. That is not insurer greed alone, and understanding the drivers helps you predict where your own renewal is heading.

• Repair costs. Modern cars are full of sensors, cameras and radar in the bumpers. A minor front-end knock that once meant a bumper and a respray now involves recalibrating driver-assist systems. Parts and skilled labour have both inflated sharply.
• Extreme weather. The Insurance Council of Australia put insured losses from extreme weather at $1.8 billion in a single half-year, much of it from Ex-Tropical Cyclone Alfred. Hail is the classic car-insurance catastrophe: one storm can write off thousands of vehicles in an afternoon.
• Vehicle values and theft. Higher used-car prices raise every payout, and organised theft of certain models has pushed those models’ premiums up specifically.
• Reinsurance. Insurers buy their own insurance globally, and that cost has climbed with worldwide disaster losses. It flows through to Australian premiums regardless of your local claims record.

The practical implication is that your premium can rise sharply even with a perfect record, which is precisely why an annual re-shop matters more now than it did five years ago.

Car insurance cost: frequently asked questions

Where to go next

For the wider picture on what things cost here, see our cost of living in Australia price guide. If you are weighing up how to buy the car in the first place, we compare the two main routes in novated lease versus buying a car, and if you are looking at second-hand imports, are used European cars reliable in Australia? covers the running and repair costs that also feed straight into your premium.

Insurance is only part of the cost of running a car. See what registration and stamp duty add in our car registration cost guide, with rego prices for all eight states and a stamp duty calculator.

Still choosing the car? Our used car buying checklist walks through the checks that matter — and it is worth getting an insurance quote on a specific model before you commit.