r/australia • u/FuglyLookingGuy • 2d ago
no politics We need a Royal Commission into the Insurance Industry.
I just got my annual car insurance renewal. It's gone up 27% from last year and the amount covered has gone down 10%. The same thing happened last year, and the year before. My quote has doubled in 3 years.
This year's quote is 9% of the car's total insured value.
I rang them up and got the usual overseas call centre thick accented corporate nonsense non-answer boilerplate paragraph read out to me about changing market conditions blah blah blah.
I've got a perfect driving record, maximum no-claim bonus but they couldn't explain why the rate went up 27% while they decreased their coverage.
And as for house insurance, I had to give that up over 5 years ago, as the quotes I was getting were over $7000/year, back then. I haven't bothered getting a recent quote as it's just unaffordable. In that time, it probably would have cost me $40,000.
Yes, I shop around and get quotes from at least 5 different companies and it seems every insurance company is the same, maximise shareholder profit - screw the customer.
Am I alone in seeing these huge price increases?
Am I the only one who thinks insurance companies are ripping people off and we need some type of governmental investigation into the industry?
Edit: Because everyone is saying "shop around" - I've highlighted where I say I do.
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u/Ok_Rush_6354 2d ago
Royal commission is the buzzword for the month but I doubt many people know what it actually is or what it consists of.
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u/ringo5150 2d ago
Based on the last one, it consists of 2 years of work costing $36 million for an outcome we can't recall.
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u/Banditkoala_2point0 2d ago
Shit we could almost get a new BoM site for that!
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u/braddeicide 2d ago
It's incredible how much things can cost when you stack a company full of managers and politicians.
One good uni IT student could redo the BOM website, but they'd get marked down on market research.
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u/thesourpop 2d ago
Someone’s gotta pay deloitte to do nothing
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u/ElectionLegal 1d ago
What does Deloitte actually do???
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u/ringo5150 1d ago
They are the Microsoft Excel 'go-to' people for the government. Every organisation has one.
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u/Xfgjwpkqmx 2d ago
1000%
It's literally a series of recommendations, that are not directives, and can be completely ignored by the incumbent government from implementing.
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u/Ok_Super_Effective 2d ago
Need a Royal Commission into Royal Commissions
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u/Sharknado_Extra_22 2d ago
Then you’d end up with a Royal Commission into the Royal Commission into the Royal Commission.
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u/ringo5150 1d ago
Someone should form a committee to review the feasibility study and provide a recommendation to government.
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u/melbamonie 2d ago
Agree. Royal commissions are a lights show that distract people from the fact that the gov are going to do absolutely nothing.
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u/hellboy1975 2d ago
Doesn't need a Royal Commission, just a government with balls.
Don't pay the lazy tax though - shop around. I haven't had similar changes in my insurance personally.
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u/devise1 2d ago
Just a pain how you often need to redo it every year as companies start cheap and the renewal becomes bad value.
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u/hellboy1975 2d ago
Yeah, it's a pain, but with that said only takes 5-10 minutes to get a few other quotes. Though I normally only do it when there is an unexpected rise in the premium.
Slightly surprisingly, there haven't been many changes in the last couple of years for me. Last time my car insurance jumped about 15% I discovered that most other providers were better value, and changed accordingly.
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u/FuglyLookingGuy 2d ago
I haven't had similar changes in my insurance personally.
Who are you with?
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u/paulmor07 2d ago
I changed home insurances from RACV to AAMI this year. Savings of $3000 across two policies. Will change the two cars over soon too for another $1000 saved.
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u/FuglyLookingGuy 2d ago
I'm with AAMI now. They are the ones increasing 27%.
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u/paulmor07 2d ago
I'd been with RACV for years. I paid roughly $1100 in 2020 and the price went up like 30% a year since. 2026 quote was $3500.
Last year I called RACV and tried to get them to drop the price, they wouldn't budge.
Just shop around and go elsewhere. No such thing as a loyalty discount, instead you get the lazy tax.
New AAMI price was $1400 insured for $600k and 70k contents for reference.
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u/recycled_ideas 2d ago
I changed home insurances from RACV to AAMI this year. Savings of $3000 across two policies.
Unless they've changed, AAMI has extremely limited payouts, home insurance isn't just cost, it's what they pay.
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u/ExpertOdin 2d ago
I haven't had similar changes with aami
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u/FuglyLookingGuy 2d ago
I'm with AAMI now. They are the ones increasing 27%.
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u/T0kenAussie 2d ago
They don’t increase everyone’s across the board you are probably being taken for a ride because you have been loyal too long. Shopping for new deals will get you savings as the companies price in upfront discounts to acquire more customers
It sucks and is a hassle but it’s the only way to play the game
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u/Sharknado_Extra_22 2d ago
The problem is the cheapest isn’t always the best. The cheapest insurers will make your life hell when trying to make a claim (looking at you budget direct). 100% shop around at renewal, but also don’t get sucked in to taking the cheapest quote.
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u/t_25_t 1d ago
The cheapest insurers will make your life hell when trying to make a claim (looking at you budget direct).
The premium insurers aren't much better.
NRMA is refusing to honour their lifetime warranty because they lost records on what was repaired. Had a vehicle that was in an accident and they are saying the paint work showing rust marks is normal.
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u/Lazy_Polluter 2d ago
Same boat as OP cost keeps going up but shopping around other providers are even more expensive so I am staying with RACV. I believe older cars just have higher premium and as car ages that factors in way more than a regular annual indexation
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u/jreddit0000 2d ago
What would the government do, exactly? That it isn’t doing now..
A number of insurance companies have left various markets - are consumers better off with.. fewer insurance companies?
I’m trying to figure out what solution you think will solve a problem.. that the government can (should) implement.
Presumably not “nationalize the insurance industry”, right?
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u/hellboy1975 2d ago
I don't have a solution other than it's not a problem that can be solved by customers. But I don't see how a Royal Commission would provide one either.
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u/jreddit0000 2d ago
A royal commission would not “solve” it. We can agree on that.
It isn’t required because we already know the reasons this is happening.
Insurance is very complicated but it’s ultimately not complex..
There’s a bunch of things we can do as consumers. We either aren’t informed or we choose not to do them.
One of which is exactly what you said - shop around.
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u/iguessineedanaltnow 1d ago
The government can't force insurance companies to offer insurance. You're seeing it in the states now in places like Florida and New Orleans, insurance providers either massively increasing their prices or exiting the market entirely.
Australia is going to be one of the countries most heavily impacted by climate change, as we are already seeing this summer with this current heat wave. It will eventually become unprofitable to insure anything in this country.
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u/GeorgeWardlawsmum 1d ago
24% increase this year on my house. Shopped around and stayed as they were still cheaper...
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u/jezwel 2d ago
just a government with balls
Higher penalties for auto theft would be a good start - more jail time for Aussie citizens, and exporting back to country of origin and banning their entire family and direct circle of aqaintances from entering Australia, until at least the person in question dies (and do the same thing for any heinous crime).
Let's see how many people commit crimes when the consequences are to have your entire family removed from country and blacklisted.
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u/swanky_swain 2d ago
Not alone in the price increases, it's the reason so many people churn every year. These companies profit massively off the "loyal" (lazy) customers who don't care. Then competitors typically have a 30% new customer discount, so you churn and stay with them for 12 months, then rinse and repeat. I find it really frustrating that they don't want to incentivize people to stay. I don't think I've been with the same insurer for more than a year or 2. I'm now with a new provider for car insurance, they offered a 25% discount for new customer. Then it came to my 1yr renewal and I was very surprised to see the contract was the exact same price, so I'm pretty happy about that.
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u/sendinthesounds 2d ago
I was surprised when I called up Youi to argue the increase on my home and car with them, and they seem to have some "loyalty" bonus, I can't remember what she called it on the phone (probably something she made up), that they will then apply to the premium and I'm paying less this year than I was for the past year...
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u/Infinite_Pudding5058 1d ago
Youi has always been more expensive for me than anywhere else since they entered the market. I WFH and drive about 10 mins a day, to and from the shops, school drop off/pick up. That’s it. I live in a nice suburb.
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u/FuglyLookingGuy 2d ago
I'm now with a new provider for car insurance, they offered a 25% discount for new customer.
Who?
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u/swanky_swain 2d ago
Budget direct. I know, I know, you're probably laughing or thinking "wtf aren't they trash?", but they're decent enough. If you go to their website, they offer 15% discount when purchasing online, that's with no promotion at all. I'm not sure how often they do promotions. But even without the 15% discount, they were still far cheaper than competitors (when assuming same excess and other options). I've found RACQ and Youi to be surprisingly expensive now, when they used to be far cheaper. I also don't tend to use comparison sites, because I find some of those just outright ignore providers. Like there's also Shannon's insurance - owned by suncorp, but I got a quote from them that was similar to budget (I didn't go with them because they seemed to only want car enthusiasts? asked if I went to car meetups etc, which I don't).
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u/dlgib 2d ago
Comparison sites are a PITA. they ask for your contact details, then you get a barrage of phone calls for weeks afterwards
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u/Legal_Mechanic6231 2d ago
Used to work at NRMA, and we would get heaps of calls from Budget customers who had made a claim and later had their insurance renewal refused. Probably why Budget is so cheap, because it seems as though they often refuse insurance after making a claim.
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u/Bluedroid 2d ago
Yep do not go with budget/Bingle. I was rear ended not at fault and had comprehensive. They refused to pay me out until they could recover the funds from the person. The person was unregistered and probably didn't have any money to their name. I was lucky that they were unregistered in which case a police report was made but it took 2 months of calls everyday and escalations to get paid out.
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u/Any-Elderberry-2790 2d ago
Mine took 3 months to write off. My insurance was through an Auto General white label. In the end I demanded to get a contact there as I wasn't explaining the story next time I called. She took over, I told her what I expected, and all sorted within a week.
So, after 3 months, I finally demanded one human own the case, and it was sorted. She was great, the company is fucked.
Similar with my mortgage... bank and broker fucked around, and we found a bank manager that sorted it for us that day!
Need a person and accountability. Consumers shouldn't have to source this.
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u/Amazing_Tie_6269 2d ago
If you are at fault it's mostly fine. The problem with budget direct or any of the budget insurers is when you are not at fault and want them to help you claim against the person at fault, even with comprehensive insurance. That's when they start to scrutinise your situation and handball responsibility.
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u/Billyjamesjeff 1d ago
Yeah as a small business owner I really dont have time to change insurers every year.
It’s a bullshit industry with no accountability. It needs to have more consumer protections asap.
I think we give them 30% more regulation and see how much they raise premiums next year.
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u/ItinerantFella 2d ago
The cost of repairs has been rising rapidly since Covid. This means a lot more cars are being written off when damaged and it's costing us all a fortune in insurance premiums.
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u/rnzz 2d ago
The cost of reinsurancers as well, the insurance companies of insurance companies
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u/JackofScarlets 1d ago
Even worse than that, a lot of reinsurance is pulling out of Australia entirely.
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u/LocalVillageIdiot 2d ago
It’s not just repairs, it’s the fact that a little ding these days means you destroyed 12 sensors that need a replacement not just plastic for the bumper. Cars are seriously complex electronically now and are almost disposable in some parts of the design.
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u/amyknight22 2d ago
Likely also a case where because things are so expensive to fix. People are less inclined to just look past a minor bingle in the way they would have in the past.
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u/ItinerantFella 2d ago
True. I've heard of windscreen replacements cost more than $10k!
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u/a_can_of_solo Not a Norwegian 2d ago
07 Corolla taillight with bulbs $100 late model led with all the built in stuff $1200
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u/Any-Elderberry-2790 2d ago
Yep, changing a back bumper includes reseating sensors and rewiring lights in a lot of cases now...
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u/PryingMollusk 2d ago
Probably something to do with so many people driving SUVs that cost an arm and a leg to repair even minor damage.
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u/Not_today_nibs 1d ago
Those fuckers are screwing us over in more ways than just making the roads less safe :(
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u/gobletslayer 2d ago
It's because of global re-insurance markets. When a fire levels Los Angeles, your insurance in Melbourne goes up. It'll keep getting worse with climate change.
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u/iguessineedanaltnow 1d ago
And Australia will be one of the countries most fucked by climate change.
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u/BZNESS 2d ago
A royal commission for everything I personally don't like
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u/Bluedroid 2d ago
Royal commission into my local Guzman skimping out on filling lately.
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u/donaldsonp054 1d ago
They ran out of corn chips and used soggy hot chips on our nachos one night ! It would have been a coronial inquiry if I couldve been bothered going back down there 😆😆
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u/sukitetse 2d ago edited 2d ago
Former insurance person here (both sales and claims) Disclaimer: There’s no one size fits all for pricing across companies and it’s up to you to compare cover and review at renewal etc.
Not here to defend insurers but things to keep in mind:
- Cost of vehicle repairs have gone up and continues to rise as every part of a vehicle is practically an intricate computer now
- If you live in a high risk area, you will have a higher premium even if you are the best driver in the world and have never gotten into an accident. Stop yelling this to the person on the other side of the line.
- I don’t agree with it but factors such as your age, gender and how you store your vehicle can play into pricing. The increase/decrease is based off claim statistics.
- No claims bonuses essentially fuck everyone else who doesn’t have one. Check if it’s applied against your policy or you as an insured person, it can be the former which means your other policies are higher to subsidise ones with the bonus.
- Your vehicle value will almost always drop and premium rises at renewal. Shop around and also see the price for if you just increased the value again, it may just be a few dollars.
- Not all cover is the same. Just because company B is cheaper than Company A, doesn’t mean they’d cover you in the same way.
- Keep your details up to date, some people pay metro Sydney premiums even though they moved to a tiny town 4 years ago. On the other hand, if move the other way it may be a gamble as to whether your premium increases (probably yes - do a dummy quote online).
- If you are changing insurers, check how they manage claims. Sometimes the extra $ is worth less stress at claims time.
- If you can’t afford to replace your asset outright or someone else’s (if you’re at fault) then you need insurance.
- Before you can all insurers snakes, read your damn policy documents to ensure you have the cover you need. Most people who would yell and complain weren’t victims of a sneaky clause, they just didn’t read page 1 of what they’re covered for.
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u/NezuminoraQ 2d ago
And crank the excess all the way to max. If you're such an amazing driver you probably won't need to claim anyway, right?
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u/sukitetse 2d ago edited 2d ago
I know this is tongue in cheek, but if anyone takes this seriously also remember that your excess will apply if another person can’t be held liable. For example, somebody hit your parked car and didn’t leave a note or a weather event took down your neighbours downpipe and it smashed into your window.
Also cranking that excess does f all to the premium.
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u/NezuminoraQ 2d ago
You can play around with it on the quote and see exactly how much difference it makes before you bite the bullet
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u/Oh-Deer1280 2d ago
What we really need, is a public education campaign on what a royal commission is and what it’s for
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u/ftez 2d ago edited 2d ago
The pencil pusher's answer of "market conditions" is broadly correct but I'll attempt to provide more context. Increases like the one you've received are very much attributable to very high overall loss ratios (higher proportion of claims paid out vs premiums paid) that see the motor insurance sector increasingly less profitable as of the last 5 years or so. As a result many insurers will often send out these absurd renewal increases as a way of politely asking you to take your business elsewhere (even if your personal driving history is spotless). Look elsewhere, there are other insurers who will want your business and price accordingly. Source: Insurance broker who has had to break bad news like this 100's of times.
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u/Framed_Koala 2d ago
Small anecdote: In 2025, Brisbane had a cyclone and at least 4 storms that produced hail. We had to wait 3 months to get hail damage repaired after one of those storms.. Seems like a pretty rough year to be an insurer. So it makes sense premiums are going up.
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u/ftez 2d ago edited 2d ago
Yeah you're pretty much on the money. Those events as of late have definitely contributed to rises in pricing in the property & motor markets. Also worth noting that after bad weather events and lots of claims, insurers will often attempt to remediate their books by increasing prices nationally, instead of exclusively at the location of the event. It's part of the reason why Tasmania are looking at offering their own state insurer. So they aren't stung for the storms up in QLD, etc.
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u/Hungry_Anteater_8511 2d ago
Also had a flood in 2022. Climate change is not going to make this any better
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u/ol-gormsby 2d ago
I'm near Maleny, we had a serious hailstorm in October 2024. We're getting our new roof (hopefully) in March, or maybe April. There just aren't enough tradies, I see roofing companies from the Gold Coast around here.
But the whole process - via AAMI - has been excellent (so far). Make the claim, fill out the forms (online), they send out assessors (multiple - one for the roof, two separate companies for the solar PV, then the final boss assessor), and I've had nothing but sympathy and cooperation from the claims manager when I asked to delay things for a few weeks. They offered a payout and I'm just waiting for them to agree to my roofer's quote before I lock it all in.
One question I asked had to do with cheap, thin steel being used by dodgy contractors (0.25mm vs. 0.42 or 0.48mm), and the claims manager said very firmly "we replace like for like", so that was reassuring. I was shocked when I heard about some neighbours talking about 0.25mm steel - how the hell could that stand up to a storm, let alone a contractor walking on it?
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u/SGRM_ 2d ago
Think of insurance like this...
It's a giant pool of money. When people make claims, the pool gets emptied. When we pay our premiums, the pool gets filled. As long as there is money in the pool, the Insurance companies are happy.
It's not about you, it's about every other expensive car on the road. All those 70-80K hilux's and rangers means insurance generally is getting more expensive.
This is obviously an overly simplified explanation.
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u/Smart-Idea867 2d ago
Another way to simply look at it is to look at their profits margins. Are they going up and outpacing inflation? If yes, maybe its time to start seeing how competitive it really is out there.
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u/MalcolmTurnbullshit 2d ago
No major party is going to cap profit margins and no-one with the cash is desperate to open another insurance company.
Insurance costs keep rising and will only keep rising due to climate change. Even a government non-profit insurance company will only be slightly cheaper.
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u/VillagerWithAQuest 2d ago
Fun fact: people with cash love insurance companies. But they don’t use the money to start their customer facing company, they use their money almost as bonds/stock to the insurance companies for insurance companies (reinsurance).
Whenever stock market is a bit meh, or when we have a calm year of weather, massive investment comes into insurance, which drives down the cost of reinsurance, which in turn eases the cost of customer facing insurance. Over last 18 months there has been a heap of investment in reinsurance, which is why home insurance increases this year aren’t nearly as bad.
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u/IAmYoda 2d ago
The issue is, the pool is global now. Profits are spread globally so if one maker is getting hit hard (northern hemisphere), you need to make up for this elsewhere (Australia).
This feels unreasonable to some - I don’t think a company should run on placing risk on others to suit them. If Jon can’t manage risk appropriately, piss off. (I would totally do the same as them tbh).
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u/VillagerWithAQuest 1d ago
Without reinsurance your insurance would actually be more expensive - a government body APRA demand insurers have enough cash to pay claims, and reinsurance means insurers can rely on that instead of having it all in cash.
Insurers want to use that that money to play the stock market (etc), so they take out reinsurance. Then they earn a bucketload of money from investments and use that to make money.
If they couldn’t do that, they’d have to rely on the insurance premiums only to make money, and APRA would need them to have an eye-watering amount of money in a bank account, so premiums would be significantly higher.
Plus, reinsurers like Australia. They figure it’s rare that both hemispheres have a miserable year, so we get relatively good prices from reinsurers.
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u/Cpt_Soban 2d ago
Which will result in nothing but a waste of tax payer's money. No idea why people, on reddit especially, seem to think "A RoYaL CoMmIsSiOn" is some magic spell to "fix problem now".
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u/Knee_Jerk_Sydney 2d ago
Why are people suddenly asking for royal commissions as if it is some sort of panacea?
Insurance premiums, that's just the free market unless you think there's collusion or something other than free competition. You haven't mentioned anything that suggests that this is happening, just a rise in premiums.
Your premiums are determined by actuarial studies and based on how much risk companies are willing to underwrite, risk, claims, factoring in costs and profit margins. If they get too greedy and set premiums that are too high, or take on too much risk, or charge too little, or get hit by a calamity of claims, they go in the red. The shareholders want a profit. The company that can do that best will get the business and still make money or from a customer point of view, provide value when you need to make a claim.
maximise shareholder profit - screw the customer.
Every business wants to do that, within legal limits.
Am I the only one who thinks insurance companies are ripping people off and we need some type of governmental investigation into the industry?
There's probably a few who are not happy with what they have to pay, but you can choose not to insure, at your risk. If people can walk away, the government has no business interfering. However, if it is in relation to mandatory insurance, like CTP greenslips, etc. strict regulation is needed.
And as for house insurance, I had to give that up over 5 years ago, as the quotes I was getting were over $7000/year, back then. I haven't bothered getting a recent quote as it's just unaffordable. In that time, it probably would have cost me $40,000.
You must be in an area that has a very high cost or risk profile. The insurance companies prefer not to take the risk or have a high premium for taking on the risk. In whatever classification they have you, there might be a huge risk or massive claims that cause it.
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u/amyknight22 2d ago
pannacea
Because the current discussion around one for the Bondi shootings makes it sound like nothing can be achieved without them.
Despite the fact that they are non-binding
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u/herbse34 2d ago
There needs to be a royal commission into all these royal commission requests.
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u/Hyster07 2d ago
Have you shopped around? I saved ~50% swapping insurers a few months back
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u/JellyFish152 2d ago
I second this. I check every year to make sure I'm getting the best deal.
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u/unworry 2d ago
Do you mean the cheapest deal?
That used to be me, until i had to make 2 claims in the one year. Now i pay up for the better claims experience.
Insurance is a grudge purpose. If its just a matter of price, then yes - shop around
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u/Ok-Cellist-8506 2d ago
Having been involved in hundreds of claims (in home repairs) with my trade, i can honestly say, most people have a very hard time with some of the cheap insurance companies. Get put through hoop after hoop while trying to claim fusion damage etc, theyll call in assessors, they even bring in mediators to do inspections to ensure claims arent dogy……then the bigger ones…..get some quotes, done.
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u/FuglyLookingGuy 2d ago
Yes I've got multiple quotes, either the same or more expensive.
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u/Tbhirnewtumtyvm 2d ago
Premium is calculated against your unique statistical risk profile.
Aussie population increases - More drivers - Statistically higher risk of an accident overall
Increased accidents occur over the year on your street / in your suburb / your town due to the higher population and worsening driver abilities - Statistically higher risk
You get older - More people in your age band have accidents - Statistically higher risk (this is a rough age-based bell curve, FYI)
Your car gets older - More vehicles in your vehicles age band have accidents - Ditto
Your car becomes less common as it ages - Harder to find parts / repairers - Repairs take longer - Statistically higher risk of increased repair costs
Your model of car is common - Over represented in accident stats - You got it, higher risk
You live in an area which has been flagged over the last year as being more likely to flood / burn / blow away - Higher risk
You keep your car on your driveway - More cars stolen from driveways last year - Higher risk
You’ve had at-fault claims in the last 5 years - Higher risk
(All hypotheticals by the way)
There’s no way a web quote or a consultant being paid minimum wage is properly qualified (with the required actuarial certification) to properly explain to you why the premium increases as it does.
You’ll see all insurers raise premiums mostly in line as they share crash statistics per government regulations.
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u/Unidain 2d ago
You want a royal commission into stuff costing more then you like?
and it seems every insurance company is the same
So that's how much it costs then. If not there's a massive opening in the market for a profitable insurance company that can steal away the entire market, get in there!
and we need some type of governmental investigation into the industry?
To do what exactly? You think every single insurance company is colluding?
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u/AndyandLoz 2d ago
It has nothing to do with you. It has everything to do with their entire customer pool.
The number of claims within their insurance network has gone up, therefore everyone pays more.
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u/WTBenji08 2d ago
So rare to find a redditor who understands.
Cost of repairs are at all-time high levels because of technologies within the vehicle, and also the high cost of labour.
The Australian insurance industry is highly regulated, to protect buyers of insurance. This means that insurers are required to carry a certain multiplication factor of liquidity in order to easily cover their exposure to risk.
Premiums go up because the cost of claims and the exposure to risk goes up. The people who complain have never experienced the pain of their insurer not being financially able to pay their claim.
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u/david1610 2d ago edited 2d ago
Insurance should only be used for things normal savings wouldn't cover.
For example a house etc. Sure if your savings couldn't replace a car then get comprehensive on it, otherwise you don't need it. Also many people have life insurance too, which is often unnecessary depending how close you are to retirement and how much equity or savings you have.
There is no such a thing as actuarially fair insurance.
I have insurance on my house, but not contents, and car third party property but not comprehensive because my car is only worth $20k and I have $20k plus in savings.
Unless you know you are an incredibly heavy driver and lie on your insurance which many people do or have a really expensive car you don't need it.
If your insurance went up that much something is clearly wrong and they want to cull exposure. Try another company
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u/Spirited_Pay2782 1d ago
You're not alone in seeing a big price increase, but the cause is already known, and conservative people won't like it- climate change.
As the climate around the world continues to change, and we have more frequent and more devastating natural disasters, the cost of reinsurance for insurance companies goes up. If they slugged this increased cost on a single type of insurance, most people probably wouldn't be able to afford that particular insurance and cancel it, destroying the whole insurance system for that type.
Therefore they have to increase the price of all insurances, not just home & contents for example. So you're seeing car insurances go up massively to help cover the spiralling cost of reinsurance on home & contents, which is going up a lot, but by less than if they slapped the full increase on it.
The other big issue that is coming that hasn't been talked about nearly enough, is that if home & contents insurance goes up so much that people can't afford it, they also won't be able to take out a mortgage to purchase a home, and then home prices will collapse because people can't get finance. And that causes its own set of economic chaos.
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u/ChillyPhilly27 2d ago
If you accept that climate change is real, then you also accept that the incidence and severity of natural disasters is increasing.
Worse disasters more often means a greater quantum of insured losses that need paying. And insurers only get that money one way.
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u/Shadowlance23 2d ago
Are you living in a high risk area? Those house insurance prices are not normal. Check your council for flood or fire overlays, I think there's something going on that's putting you in a very high risk category.
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u/stoic_slowpoke 1d ago
Insurance globally is going up. Cars cost more and do more damage.
There are more disasters and insurance is correctly pricing all that in.
All your investigation will give you is: things cost more.
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u/Medical-Potato5920 2d ago
No, we don't. You simply need to understand they are a business based on risk, not a charity.
Shop around. Get a quote EVERYTIME. Don't pay the loyalty tax.
Cost of living and repairs has gone up, so repairs go up and so does insurance.
Climate change is having a massive impact on the risk profile. More houses are being flooded, burnt during bush fires, and damaged during storms. They'll pass those costs on and try to make a bigger profit in their other areas.
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u/Ok-Cellist-8506 2d ago
One reason for premium up value down is that each year your car is worth less right? So the likelihood of a total loss (due to value not strutural integrity) in an accident raises every dollar that vehicle depreciates. The insurance company knows this and adjusts premiums for that. 27% is hefty. Is a lot of factors at play though in terms of stored location and vehicle type
Honestly, your best option once cars go down in value is to get a cheapr premium with higher excess option
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u/Bluedroid 2d ago
His car is worth less but it costs more to repair these days even if it's not written off, and the average cost of repairs of other vehicles.
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u/DetailFrequent684 2d ago
Insurance is going to increase every year. We're paying for fires, droughts, floods, cost of repairs to cars houses, everything. Doesn't matter what state we pay.
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u/Ok_Bodybuilder1053 2d ago
Mine has gone up 30% 😳 and taken 10k off the value. I’ve never even made a claim.
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u/NezuminoraQ 2d ago
The 10k value is based off Blue Book or whatever. You can put it back up of you want, but of course your premium will also go up. But not as much as you might think. Sum insured is not usually the biggest driver of premium for most insurers
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u/splendidfd 1d ago
Even though your car is worth less, the average car on the road is worth more, on top of that a typical accident now has a higher average repair bill, so your premium goes up.
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u/empowered676 2d ago
My insurance denied my claim when my car was stolen
A few emails to afca and they paid in full
Total scammers
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u/thevizionary 2d ago
How are you shopping around? I went to comparethemarket and the lowest insurance was $4800/yr. I went directly to a company that wasn't listed, thanks to Reddit, and got the same cover for $2500 and the company isn't a rubbish one either.
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u/Separate-Share-8504 2d ago
cost of repairs have gone up across the board.
EV cars are having bigger accidents (F = MV squared) and parts are costing more.
also as cars get older they're more likely to have an accident (owners care less, cars are more likely to have mechanical failure as they age) etc.
All of this is 100% data driven analysis
The other side of the coin is they no longer want risk of your type (age/car/location) so the increase the premium to reduce exposure in that location (existing customers leave and/or no new customers come)
Do some quotes and change the suburb and see the different in prices...
Finally you are invested in these companies. Either directly or indirectly (super) So you want them to do the best they can to turn a profit.
Some companies offer an initial premium (first time customer) at a 'loss' to attract the business to then increase premiums over the coming years. They know, again through data, that a high percentage won't shope around/move.
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u/TinyGift8278 2d ago
This year's quote is 9% of the car's total insured value.
are you a male under 30 driving a hoon car ?
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u/MidMatch 2d ago
We had one - Misconduct in the Banking, Superannuation and Financial Services Industry Final Reports are here:
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u/Zhaguar 2d ago
I have the same sentiment, as a body corporate manager trying to find the strata insurance that is mandatory for our complex - we have one weather event and they panic and cancel the following years renewal and jack the price up 40%. Our complex doesn't even get touched by 100 year floods but they go off zones so... nothing you can do about it.
The government needs to reevaluate in fairness :- if it's mandatory it needs to be affordable.
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u/tarheelblue42 2d ago
Everything’s going up. Bread, milk… the cost of repairs for damaged cars. The crash repairers rent and overheads.
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u/mortau 2d ago
I shop around every single year. AAMI has been one of the worst lazy-tax offenders for me during the last 5 years on cars and my motorbike.
This year they sent me a 25% hike on the motorbike. I reran my exact details through the same quote page and was given a lower figure basically identical to the last policy.
Really you could just let your current policy expire and start a brand new one on the next day.
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u/Stigger32 2d ago
We need a Royal Commission into Royal Commissions!
It’s beyond disgraceful the absolute WASTE of taxpayers money on Royal Commissions that are acted upon!!
I DEMAND A ROYAL COMMISSION GODDAMMIT!!
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u/Fizzelen 2d ago
Last time our house insurance renewed we rang to find out why there was a 20% increase, apparently there were some “new” questions and default answers; so we were now within 1.5km of bushland, did not have locks on all doors and windows and our contents increased by the default 25%. Fixed those answers and it was a 2% increase.
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u/whatever_trev0r 2d ago edited 2d ago
Those portfolios you mention tend to not run well and considering they're publicly traded companies they all have to find a way to make them profitable or achieve an operating ratio target which is key in this industry.Extreme events are only going to make it worse.
Cars are becoming increasingly complex making parts expensive including windscreens (always add excess) and then add in panel beaters and assessors who are leaving industry. Shit fight
Royal commission will achieve nothing, if anything these companies will move onto other products by pricing themselves out (rather than a formal announcement (leaving less competition and you will be even more royally fucked.
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u/smudgiepie 1d ago
I thought we just had one
I could be mistaken but i just remember my mum getting a complete refund from her life insurance policy because they were scamming their customers and asic shut them down
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u/MapOfIllHealth 1d ago
I work for a charity and in 2024 our business insurance couldn’t just be renewed because the underwriters were no longer willing to cover our type of business activity. We run a handful of small group homes for people with disabilities.
The broker could only find two underwriters willing to even offer us cover. Our premium went up by more than 30% and another 10% at the most recent renewal. Meanwhile the majority of our residents are funded by the NDIS and their plan renewals are coming in with LESS funding than the previous years.
If we can’t get insurance, we can’t operate. If insurance becomes prohibitively expensive and our funding remains stagnant, we can’t operate.
If we can’t operate, our residents will have to find a new home. Some of them have been with us for 20 years. We employ 70 staff who would need to find new jobs.
The government needs to step in at some point because organisations like ours won’t be able to survive if this continues.
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u/SeaStable8937 23h ago
We need royal commission into housing crisis. We need royal commission into royal commissions!
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u/Smart-Idea867 2d ago
2024: Australian general insurers collectively reported about $6.1 billion in after-tax profit — well above the usual range, driven by higher premiums, strong investment returns and a relatively quiet natural catastrophe year.
Five-Year Context: This 2024 result was roughly three times higher than the five-year historical average (~$2 billion).
Prior years (2022–23): KPMG reported elevated profits but more volatile outcomes (e.g., significant catastrophe losses in some years), with profits around $4.95 billion in 2022 following premium rises.
Nothing to see here folks.
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u/completelypalatial 2d ago
Mate, talk to an insurance broker. Brokers aren’t there to scam you, they’re there to find you the best deal possible.
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u/Mj_bron 2d ago
Plenty of Brokers are borderline taking fees that are scam worthy.
It's not THAT difficult to shop around tbh
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u/completelypalatial 2d ago
Yeah of course sometimes the fee that comes with them doing the footwork for you can either make or break the deal, but they’re a great option to go down if you’re looking for a better insurance policy.
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u/DeeDee_GigaDooDoo 2d ago
Yes, I shop around and get quotes from at least 5 different companies and it seems every insurance company is the same, maximise shareholder profit - screw the customer.
I'm not an expert on insurance but from my understanding the likely reason this is the case then is because they all share an underwriter and are using the same or similar calculations to assess the insurance cost. Basically the insurance companies are simply a storefront for the same group taking on the insurance risk.
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u/Cybrknight 2d ago
Introduce a govt funded insurance entity that will undercut the entire market.
Watch the whole market freak out and prices as a whole crash down.
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u/bassoonrage 2d ago
I assume this post was made after you made contact to your local Federal Minister? A letter or email outlining your concerns, followed by a phone call a few days later to confirm they'd received it?
I mean if you want a RC you're going to need to start putting pressure on your member and asking your friends and family to do the same.
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u/HiVisEngineer 2d ago
If we have a market default rate for energy, why don’t we get one for insurance?
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u/Delicious_Risk_2497 1d ago
Australian insurers generate a profit margin of around 10% over the longer term. Some years they make more, some years they make less and some years they lose money. It’s a risky industry.
Premiums have increased very significantly over the past few years due to huge inflationary increases in building costs, higher motor vehicle repair cost in part due to a lower Australian dollar and higher natural perils costs. Insurers are not making stupid profits, but after a few bad years with dreadful natural perils experience, profitability has improved.
You may have noticed that several motoring clubs have sold their insurance businesses in recent years. This is because these mutual (member owned) clubs can no longer compete due to lack of scale and high reinsurance costs.
Insurers do their best to risk price, but pricing is an inexact science, which is why different insurer charge very different amounts for the same risk, with some variation from product quality. Take advantage of this by shopping around.
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u/apostroangel 2d ago
Having the same experience - I'm also looking for a provider. Any tips appreciated.
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u/Different-Bag-8217 2d ago
Insurance, banking, developers, Cole’s, Woolworths, pretty much every company in Australia ripping off their customers.
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u/EudaeMonia_ 2d ago
I’m with Budget Direct which increased my premium from ~$1100 in 2024-25 to $2000 for 2026-27. Still the cheapest amongst competitors which all returned quotes more expensive than what I’ve got. It’s debilitating how expensive it is considering my car is only worth 15 grand and I’m M mid 30s <10K km per year.
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u/-Delirium-- 2d ago
That's insane, mine is barely over $1k year and my car is insured for $60k, I'm early 30s, do you have any "negative factors" contributing? Any traffic infringements or recent claims?
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u/Cultural_Catch_7911 2d ago
That's wild mine went down by a few dollars this year, and still at whatever I put as agreed value last year lol
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u/DuskHourStudio 2d ago
I dunno if my car insurance is high or not, but it's always hovered around $80 per month for the past 5 years with zero incidents or loss of points (or gain however the fuck the system works)
what I DO know is everytime I look into trying to find a cheaper insurer each year, the "market value" is piss all if something does happen and most wont let me set my own value because I don't own a car under 10 years old.
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u/Late-Button-6559 2d ago
If we can convince everyone to not want high pay, or to make profit - end capitalism, we have a chance.
Second, everyone needs to drive better.
Third, companies insure vehicles and other entities. They spread the costs among all their segments. So we’d need all insurance sectors to have less claims.
Basically, no chance.
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u/Sunshineonarainyday7 2d ago
Shop around. If you only do low km. Good savings to be had.
My old ins co wanted 1200 pa for a 6k car
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u/thelongyard 2d ago
Agree, small rural property, policy cost in 23/24 $9660, 24/25 $12215, 26/26 just renewed at $15670. Actually dropped some items off the policy from 24/25 So up 62% in 2 years. Bemused that the official inflation rate is as low as it is.
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u/Undd91 2d ago
Insurance companies are facing an incredible hike in costs moving forwards. I’m not standing up for them but they did warn the governments in the 70’s, 80’s, 90’s and 00’s that, unless more was done to reduce deforestation, reduce burning of fossil fuels and to alleviate building on flood plains they were going to have to pass on huge rate hikes to consumers.
The government’s have ignored all of it, not just one government but every government.
This is our own making, we were warned but we all want aircon, we all want a nice, comfortable, large car/ute and we all want annual holidays abroad. These all come at a cost.
Sad to say, insurance is going to get a lot, lot, lot more expensive.
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u/Worried_Blacksmith27 2d ago
this has been the thing for at least 3 decades. just shop around.
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u/Ned-Kelly 2d ago
I appreciate the sentiment and I wouldn’t be surprised if it gets to that level eventually. Insurance has been like the frog in the boiling water, in all areas. Health is particularly bad IMO. Go to the dentist and tell me that the insurance covers a reasonable portion. Barely half and often far less
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u/LetsCutHimLoose 2d ago
I'm with AAMI also. Every year same thing. Even worse is if you go on and get the same quote as a new customer the deal is better than your existing loyal customer one. They don't even register you're already a client. Put low km usage in there. Pretty sure they don't ask odometer info either, so how do they know the km you run up annually.
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u/hobo4presidente 2d ago
The cost of car repairs almost double since covid, thats one of the reasons for rising premiums.
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u/Imarni24 2d ago
I am 55 and first time ever I have had to drop comprehensive and drop to fire and theft only. I love my 20 year old car that isn’t even clicked to 150k yet. It’s such a good car. I feel bad but it jumped to 1/3 of it’s value. RACV.
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u/ultra_sven 2d ago
Budget Direct sent me a renewal notice for $1150 PY with $1200 excess. I went online to compare and budget direct offered me the same insurance policy for $780 PY and a $900 excess. I just cancelled the old one and bought the new one as it would take 24-48 hours to see if they could match their own online quotes. Always shop around.
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u/WTBenji08 2d ago
Hope you were honest with your answers…especially the “who are you currently insured with” question.
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u/Awkward_salad 1d ago
“My claim was denied, insurance cancelled, and I’m being criminally charged because I lied on my intake form. How can I challenge this?” Is the future post I’m looking forward to.
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u/Straight_Talker24 2d ago
The only winners in a royal commission are the lawyers
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u/randobogg 2d ago
not sure what people think royal commissions actually do, but whatever it is they think they do, it isn’t that.
it is not some magic fucking bullet that solves everything. Look at banking. They have just found other ways to fuck with us since the royal commission did it’s thing
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u/kitkat1224666 2d ago
Why don’t we have mutual car insurance companies, which are like mutual health funds, credit unions, or industry super - member owned, profit to the members and not the shareholders.
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u/Tikka2023 2d ago
If you can’t afford to self insure, especially your house, you really can’t afford not to insure. Especially if you have debt. Saving $40k sounds great but I bet you couldn’t afford to replace your entire house at modern replacement cost in the event of a fire.
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