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CTP protects people not cars

CTP protects people

CTP is compulsory third party insurance to cover people who are injured or die in a road accident involving your vehicle. If you want to protect your car, you also need comprehensive insurance or third party property damage insurance. Make sure you know the difference between CTP and other types of motor insurance.

What is CTP insurance?

CTP stands for compulsory third party insurance. You have to buy CTP separately before you can register your car in NSW. It protects you, the owner, from any damages claims made if your vehicle was involved in an accident and hurt or killed somebody. It’s compulsory so compensation doesn’t rely on the financial means of the driver at fault.

CTP protects you and other people, not your car.

How does CTP insurance work?

In NSW, you have to buy CTP insurance before you can register your vehicle. It is often called a green slip, which may create confusion about what type of insurance it is.

Insurers set CTP premiums based on details of the vehicle owner, driving history and their vehicle. Postcode is an important detail. There are five rating regions: Metropolitan, Outer metropolitan, Newcastle and Central Coast, Wollongong, and Country. A few postcodes are split between two regions.

For example, a 50 year old in NSW with an insured 10-year old car could pay from:

  • $432 in Metropolitan
  • $323 in Outer metropolitan
  • $310 in Newcastle/Central Coast
  • $400 in Wollongong
  • $305 in Country areas (April 2024).

These prices don’t include any demerit points or traffic offences. The greenslips.com.au Calculator compares prices from all NSW CTP insurers based on all relevant risk factors.

What is third party property insurance?

Third party property insurance is a type of motor insurance that protects only cars or property that belong to other people. Look for the word “property” to tell the difference between compulsory third party (CTP) and third party property insurance.

This is the cheapest option when you want motor insurance to cover somebody else’s car when involved in an accident with your car. It’s cheaper than comprehensive insurance because it’s limited to other cars only.

What is comprehensive insurance?

Comprehensive insurance is not as comprehensive as it sounds because it covers only property, not people. It’s a common misunderstanding that comprehensive insurance must include CTP insurance.

In fact, comprehensive insurance covers your vehicle and property and the vehicle and property of others involved in an accident. It usually includes cover for fire damage and theft of your vehicle and may include other items like windscreens or roadside assistance. It is comprehensive cover for property, not people.

Why get comprehensive or third party property insurance?

The answer is simple: to protect your car and/or someone else’s car. If your car has a relatively low value, you might choose third party property insurance to cover other people’s cars. Otherwise, you could choose comprehensive insurance to cover your car as well. Even if you have comprehensive insurance, you still have to buy CTP green slip insurance.

How can I reduce my premiums for comprehensive and CTP insurance?

CTP premiums are affected by many of the same factors as comprehensive insurance. Some factors affect comprehensive insurance premiums only. You can reduce your premiums only if you can change one or more of these factors.

Factors Comprehensive CTP
Postcode Yes Yes
Driver age Yes Yes
Driving experience Yes Yes
Driving record Yes Yes
Claims history Yes Yes
Gender Yes Yes
Type of vehicle Yes Yes
Business use Yes Yes
Garaging Yes Postcode only
Cost to repair Yes No
Theft propensity Yes No
Colour of car Yes No

Summary

CTP protects people and comprehensive or third party property insurance protects cars. Many factors, such as postcode, age and vehicle, impact the prices of both comprehensive and CTP insurance. Even if you have comprehensive insurance, you still have to buy CTP green slip insurance.

greenslips.com.au Calculator helps you quickly and easily compare all CTP green slip insurers in NSW, using all factors that affect the price.
 

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Corrina Baird

Writer and Researcher, greenslips.com.au

Corrina used to lend her car to her kids and discovered what Ls, Ps and demerits mean for greenslips. After 20 years in financial services and over 9 years with greenslips.com.au, she’s an expert in the NSW CTP scheme. Read more about Corrina

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