Why Is Comprehensive Insurance Compulsory with a Car Loan?

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Why Is Comprehensive Insurance Compulsory with a Car Loan?

Posted on by carbroker

It’s never been a better time in history to score yourself a great car loan. Interest rates are at an all-time low and car loans can be dirt cheap, so if you’ve been thinking about it, now’s the time!

If you’ve already done your research on car loans and how they work, you might’ve noticed that it’s compulsory to get comprehensive car insurance while paying off your loan. It’s wise to get comprehensive insurance on something as valuable as your car, but why do finance providers make you get it? Let’s discuss.

What is comprehensive car insurance?

But first, let’s explain comprehensive car insurance. If you’re involved in an accident on the road, in which you’re at fault, this type of insurance covers the other driver’s car as well as your own. It’s highly recommended to have comprehensive car insurance if you consider your car ‘valuable’ – and by this, we don’t mean ‘expensive’, but rather that your car performs a valuable task and you couldn’t live without it.

Why is it compulsory when paying off a car loan?

Whoever is financing your car, be it a dealership or finance provider, makes it compulsory for you to have comprehensive car insurance. This is because they’re the ones who will need to replace it if it gets written off in an accident, as well as recoup the outstanding amount of the loan that you owe. It’s compulsory to have comprehensive car insurance while you’re still paying your personal car loan off to cover not only your damages but to make sure your lender receives their full amount of money, which you wouldn’t want to come out of your pocket anyway.

Should this turn you off getting a car loan?

Absolutely not. Comprehensive car insurance is something you definitely want, whether it’s compulsory or not. Sure, you’re paying a little extra per month to insure your car, but you’re avoiding the potential nightmare of having to pay back the outstanding amount to your financier if your car is written off or badly damaged.

How to get a good deal on comprehensive car insurance

Now, this? This is a smart question. After learning that comprehensive car insurance is mandatory when paying off a car loan, your mind should immediately start wondering how to get a good deal on it. Well, it just so happens to be that we’ve got the answer:

Carbroker.com.au

If you’re looking for great deals on a new or used car, a great car loan and solid comprehensive car insurance, Carbroker.com.au is your one-stop-shop. They’re Australia’s most dedicated team of car brokers, connecting you with over 2000 dealerships across the country and doing the haggling for you. Have a chat with the team at Carbroker.com.au and get the best deal on your next ride!

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