How Much Does Car Insurance Cost in Australia? (2026 Data)

Car insurance premiums have risen sharply in Australia — up nearly 6% in 2025 alone according to Canstar data, and up 42% in the five years from 2019 to 2024 according to the Insurance Council of Australia. Understanding what you should actually be paying — and why — is the first step to making sure you're not overpaying.

How Much Does Car Insurance Cost in Australia in 2026?

According to Canstar Research (April 2026), the average cost of comprehensive car insurance ranges from $1,800 to more than $2,900 per year, depending on your age, location, and vehicle. Finder research puts the average comprehensive car insurance premium at approximately $1,560 per year based on a 30-year-old driver profile.

Average Cost by Age Group (Canstar Research, 2026)

Age Group	Average Annual Premium
Male under 25	$3,020
Female under 25	$2,706
Age 25–29	$2,176
Age 30–49	$1,607
Age 50+	$1,260

Average Cost for Young Drivers by State (CHOICE Research, January 2026)

State	Average Premium (under 25)
Victoria	$3,614
Western Australia	$2,597
South Australia	$2,612
Queensland	$2,554
Tasmania	$2,088
ACT	$2,161

Victoria is significantly more expensive than other states for young drivers — $1,000+ more per year than Tasmania and the ACT. This reflects higher traffic density, weather events, and claims frequency in Victoria.

The Three Types of Car Insurance in Australia

Type	What It Covers	Typical Annual Cost
Compulsory Third Party (CTP)	Injury to other people — mandatory to register your vehicle	Included in registration
Third Party Property	Damage to other people's vehicles and property — not your own car	$300–$700/year
Third Party Fire & Theft	Third party property + your car if stolen or fire damaged	$500–$900/year
Comprehensive	All of the above + damage to your own car in any incident	$1,200–$3,000+/year

What Affects Your Car Insurance Premium?

Age and Experience

Age is the single biggest factor for most drivers under 30. Insurers use claims data showing younger drivers are significantly more likely to be involved in accidents. The premium drop between age 24 and 25 is often $500–$800 per year. By age 30, premiums are typically 40–50% lower than at age 18.

Location

Where you live and where your car is garaged affects your premium significantly. Urban areas with higher traffic density, theft rates, and weather risk attract higher premiums. Storing your car in a locked garage (vs on the street) typically reduces premiums by 5–15%.

Vehicle Type

Insurers consider the cost of parts, repair complexity, theft appeal, and safety ratings. A performance vehicle, European luxury car, or model with high theft rates will cost significantly more to insure than a Toyota Corolla or Mazda 3. Check the ANCAP safety rating before buying — higher-rated vehicles generally attract lower premiums.

Claims History

A clean claims history is rewarded with "no claims discounts" of 15–30% from most insurers. A single at-fault claim can increase your premium by 30–50% for 3–5 years. This is worth keeping in mind when deciding whether to claim for minor damage — the long-term premium impact often exceeds the claim value for small repairs.

Excess Amount

Your excess (the amount you pay out of pocket when making a claim) directly affects your premium. Increasing your excess from $500 to $1,000 typically reduces premiums by $100–$300 per year. This trade-off makes sense if you have savings to cover a higher excess and have a clean driving record.

Annual vs Monthly Payment

Paying monthly adds 10–15% to your annual premium through instalment fees. Paying annually upfront saves $150–$300 on a typical comprehensive policy.

Which Insurers Are the Cheapest in 2026?

Based on Finder's March 2026 quote research for a 30-year-old driver with a 2020 Toyota Corolla:

• Budget Direct: Consistently among the cheapest for comprehensive cover — winner of Finder's Car Insurance Award and Canstar's Outstanding Value Award multiple years running. Online discount of up to 30% for new policies.
• Bingle: Online-only, no-frills comprehensive cover at low prices. Finder's 2024 cheapest provider award. Suited to simple, low-risk profiles.
• Youi: Risk-based pricing means Youi can be significantly cheaper for lower-risk drivers (older, garage-parked, low annual kilometres). Worth comparing even if their advertised rates look high.
• AAMI: Competitive pricing with lifetime guarantee on repairs. Good balance of price and features.
• Kmart Tyre and Auto / ALDI Insurance: Budget options worth comparing for straightforward profiles.

The gap between the cheapest and most expensive insurer for the same driver profile can be $500–$1,200 per year. There is no excuse for not comparing quotes at renewal time.

How to Pay Less for Car Insurance

Compare at every renewal

This is the highest-return action. Insurers offer their best rates to new customers — loyal customers pay more. Comparing quotes at every annual renewal and switching if a better deal exists saves the average Australian $200–$600 per year. Use Finder, Canstar or Compare the Market for free comparison, and check TopCashback Australia for cashback bonuses on new insurance sign-ups.

Increase your excess

If you have savings to cover a higher excess, increasing from $500 to $1,000 typically saves $100–$300/year. Don't increase your excess beyond what you could genuinely afford to pay if you had to make a claim tomorrow.

Pay annually

Monthly instalment fees add 10–15% per year. Pay the full annual premium upfront and save $150–$300 immediately.

Reduce listed drivers

Adding young or high-risk drivers to a policy significantly increases premiums. Only list drivers who regularly use the vehicle.

Garage your vehicle

Storing your car in a locked garage vs on the street typically reduces premiums by 5–15%. Update your insurer if your parking situation changes — don't assume they already know.

Consider the car before you buy it

The cheapest cars to insure in Australia tend to be Japanese mainstream brands (Toyota, Mazda, Honda, Hyundai) in mid-range models with good ANCAP safety ratings. European brands, performance vehicles and high-theft models all attract significantly higher premiums.

Is Comprehensive Insurance Always Worth It?

For cars worth under $5,000–$8,000, comprehensive insurance may not be economical. If your car is worth $4,000 and comprehensive insurance costs $1,500/year, you're paying 37.5% of the car's value annually for cover. In this scenario, third party property insurance ($400–$600/year) protects other people's property — your main financial liability — and you self-insure your own vehicle.

For cars worth over $15,000, comprehensive is almost always worth it. The break-even point depends on your specific premium and vehicle value — calculate it before renewing.

Summary: What You Should Pay

• Under 25: $2,100–$3,600 for comprehensive (unavoidably high — focus on excess and comparison)
• Age 25–29: $1,800–$2,500 — significant improvement, worth comparing aggressively
• Age 30–49: $1,200–$1,800 — if you're paying over $2,000, you're almost certainly overpaying
• Age 50+: $900–$1,400 — the cheapest age group, don't overpay out of loyalty to your insurer

If you're paying significantly more than these ranges, comparing quotes immediately is the priority. Our guide to reducing car insurance costs covers the full strategy for getting the best deal at renewal.