As in other industries, the influx of new players and the state of the economy influence how companies in a certain industry price their products. This has been the case with the insurance industry in Australia. The arrival of smaller (sometimes with headquarters based overseas), car insurance providers has led to a sharp increase in competition. As a result, significant pricing shifts have lately been apparent in the country's car insurance industry. Because insurance companies are always striving to expand their customer base, Australian consumers are in a good position these days. First-time premiums are very competitive, specially with online insurance brokers. But customers need to be aware that there are differences between the policies being offered, so they need to understand what they're looking for and what they need.
The traditional and established insurance companies are competing with the smaller, aggressive entrants by having launched smaller brands like Buzz and Bingle. These companies have no brick and mortar presence and are purely online products. By going this route, the more established companies hope to recapture the market share they have lost to the startups. As of the first quarter of 2012, the latest figures from the Insurance Council of Australia reveal that the average premium comprehensive car insurance including GST and stamp duty ranges from about $475 in Tasmania to $795 in NSW. This disparity is because of the variances in the policies being offered, as well as how companies price the risks in particular territories. As can be seen, quotes can be hundreds of dollars different, with the final price depending on several factors, such as age, type of car, marital status and driving record.
All in all, discount insurance companies which have been operating online have influenced the pricing of insurance premiums greatly. Another factor in helping consumers get better prices on their insurance are the comparison services. Together, these factors helped account for 2.5-3% average reduction in insurance premiums over the past year. But again, premiums will vary depending on the individual. For the example, a 30-year old with a 6 year-old Corolla would be paying from $420 to more than $1000, depending on the circumstances. But don't look at the price of the insurance policy only. This is why even with insurance premiums dropping across the board, it is still important to compare rates and policies, so that one gets the best deal possible on his car insurance.
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