Last updated 15 May 2025

There are different types of insurance policies for motor vehicles:

  • compulsory third-party insurance
  • comprehensive insurance
  • third-party property damage insurance.

Compulsory third party insurance

Compulsory third party (CTP) insurance is paid when a motor vehicle is registered. It covers the owner and driver of a vehicle ‘from being held financially responsible for damages if they injure someone in a motor vehicle accident. It also enables a person who is injured wholly or partly due to the actions of another driver to access medical treatment and rehabilitation support as well as receiving fair and timely compensation’ (Motor Accident Insurance Commission). If the car responsible for an accident is unregistered and uninsured (no CTP insurance) or cannot be identified, the Nominal Defendant of Queensland stands in the place of the CTP insurer.

It is necessary to establish that another person’s negligence caused a motor vehicle accident in order to succeed in a claim against the CTP insurer. Whilst some CTP policies include modest benefits for an injured driver if they are found to have caused the accident (driver-at-fault insurance), the last of those policies was discontinued in 2023 .

There may, however, be circumstances where someone who cannot prove negligence for an accident can claim compensation for their treatment, care and support needs if they suffer a serious personal injury. A ‘serious personal injury’ has a special meaning under the National Injury Insurance Scheme (Queensland) Act 2016 (Qld) and National Injury Insurance Scheme (Queensland) Regulation 2016 (Qld). Further information about what injuries are covered under the National Injury Insurance Scheme (Queensland) and the support provided can be found on the scheme’s website.

Comprehensive insurance

Comprehensive insurance covers the owner and/or driver of a motor vehicle for property damage claims by other persons. It also usually covers the owner for theft and damage to their own vehicle, regardless of who caused the accident. Some policies also provide cover for hospital and medical expenses, and pay a benefit if the owner is killed or seriously injured while driving the insured car (driver protection insurance).

Third-party property insurance

Third-party property insurance provides cover to the owner or driver of a vehicle for damage to other persons’ property but not their own. Every owner of a motor vehicle should take out at least this level of cover.

Losing the right to claim

It is important to read the terms of the policy carefully. Most comprehensive and third-party property policies contain special conditions which, if not complied with, could result in rejection of the claim by the insurance company.

Failure to report the accident

Most policies require the insured person to report any accident or damage as soon as possible after the accident occurred or the damage was sustained. Even if the owner/driver does not intend to make a claim on the insurance, it is still advisable to notify the insurer of the accident in order to protect their rights. Strict notice requirements apply for personal injury claims.

With respect to property damage claims, failure to report the accident to the insurer may not invalidate the policy. However, the insured may be required to pay the insurer any legal costs incurred unnecessarily as a result of the failure to notify the insurer.

Alcohol

Most comprehensive or third-party property insurance policies stipulate that no cover will be provided if, at the time of the accident, the driver was under the influence of alcohol or drugs. The terms of the exclusion will vary between policies but could provide that the insurance cover will be invalidated if the driver fails a breathalyser test or is convicted of failure to supply a specimen of saliva or blood for testing.

Unlicensed driver

Most comprehensive or third-party property policies exclude cover if an unlicensed driver was driving the vehicle at the time of the accident.

History of insurance claims

When taking out insurance, it is essential that all questions asked by the insurance company in the proposal form be answered carefully and truthfully. Questions about the owner’s past driving record must be answered fully and honestly, otherwise the insurer may have grounds to reject a subsequent claim.

Alteration of the vehicle

The modification of a car or the attachment of accessories can invalidate the insurance cover under some policies. Any modifications or accessories of a mechanical nature must be disclosed to the insurer and specifically covered by the insurance.