Third party property damage insurance

Third party property insurance is a type of car insurance coverage that provides protection against financial liability for damage to someone else's vehicle or property in the event of an accident for which you are at fault.

This type of insurance does not cover damage to your own property or vehicle; it solely covers the costs incurred to another party's property. It's a mandatory requirement for all registered vehicles in Australia to have at least a minimum level of third party liability insurance.

Third party property damage is one of four available car insurance options in Australia. It is entirely separate to CTP insurance, or comprehensive car insurance, for example.

The types of car insurance available in Australia and what they cover include:

It's important to note that coverage can differ between insurance providers, and it's worthwhile carefully reviewing policy details from a range of options to understand the extent of coverage provided.

A third-party property damage policy will typically only cover damage to other cars and property. This can be incredibly helpful in the event that you are in an accident at which you are at fault, and you cause damages that you cannot afford to repay out of pocket.

Third party property damage insurance in Australia typically includes:

• Property damage coverage: Covers the cost of repairing or replacing the other party's vehicle or property that you may damage in an accident.
• Liability protection: Helps cover your legal liability for the damage caused to another person's property.
• Uninsured driver protection: Some policies may include coverage for damage to your car caused by an uninsured driver, although coverage may vary.

For example, say that you were involved in an accident where you were at fault, and you caused major damage to a luxury vehicle, like a Ferrari. If you only had CTP insurance, it is likely that you may need to cover these damages from your own savings. And for the everyday Australian, this is a cost that is out of reach. However, with third party property damage cover, the car insurance provider may pay out your claim

You may be able to add extra coverage to a third-party policy, such as covering car hire after a theft, or loss of personal items kept in the car.

The premium charged for any insurance policy will depend on a range of factors, from the driver's age, the location and details of where the vehicle is parked and any excess you pay, to the driving history of the applicant and details of any past claims or events where they were at fault. This is why it is worthwhile comapring a range of insurance quotes before you sign on the dotted line to ensure you have the best policy for your personal and financial situation. 

That being said, the general cost of third party property damage insurance is roughly a few hundred dollars a year. 

Third party property damage cover can be a competitive insurance option for those who are trying to keep their insurance costs low. It is not as expensive as the highest level of coverage offered by comprehensive insurance, and you are still able to protect your back pocket in the event you damage another’s property.

However, it’s worth keeping in mind that while third party property damage cover is more affordable than comprehensive car insurance, you will need to pay for any damages to your own vehicle out-of-pocket. This includes covering the cost of break-ins or theft, as well as fire and other natural events.