Comprehensive car insurance premiums climbed by more than 42% between 2019 and 2024, with a further rise of 8% recorded in the 12 months to July 2025, according to a report published by ASIC in August. The same report found that insurers were not detailing how premiums were being calculated, and that 73% were giving only generic reasons for rate increases, ABC News reported.
Vehicle repair costs have risen 26% since 2022 and now make up around 60% of total motor claim costs, according to the Insurance Council of Australia's March 2025 Motor Insurance Policy Paper. ABC News reported in 2024 that profitability in the Australian car insurance market rose by $1 billion in the prior year, with insurers gaining from long-term customers who neither compared alternative policies nor sought to negotiate their premiums down before accepting higher bills.
ASIC advised policyholders to check the insured value of their vehicle, confirm that the nominated kilometres matched their actual annual driving, consider raising their excess, and remove listed drivers who no longer use the vehicle. Only 57% of drivers who have advanced driver assistance systems use them regularly, Insurance Business reported, raising the question of whether a vehicle whose ADAS features are regularly disabled has a meaningfully different risk profile from a non-ADAS vehicle.
Australian drivers with comprehensive car insurance policies face continued premium increases running well above general inflation. Policyholders may be able to limit increases by reviewing their insured value, adjusting nominated kilometres, raising their excess or removing drivers who are no longer using the vehicle.
Reporting: ABC News, Insurance Business
Written by Pick & Scroll News from the reporting and documents linked above.
