.svg)
What Voids Car Insurance?
What Voids Car Insurance?
Written by
Kervin Mathew
Edited by
Andrew Kemp
Reviewed by
Adrian BennettCompare car insurance policies the easy way
Save time and effort by comparing a range of car insurance quotes with iSelect
Long story short
A voided car insurance typically means the insurer treats it as if it never existed
Breaching your policy’s T&Cs may also cause your insurer to reject your claim or cancel your policy entirely.
Common breaches can include unpaid premiums, fraudulent claims, or non-disclosure
You need to disclose things like changes to where you park, how you use the car or who drives it.
Your safest bet is being honest with your insurer and knowing your PDS
Pay your premium on time, keep your insurer informed, and avoid surprises that could leave you uninsured.
What can void a car insurance policy?
Generally, a car insurance policy can be voided if its terms and conditions are breached – in other words, if you don’t keep up your end of the deal. This could include things like providing false information to your insurer, engaging in fraudulent activities, or using your car illegally. Here’s a bit more on what can void your car insurance policy.
Withholding or misrepresenting information
As a policyholder, you’re legally obliged to be honest about anything that could affect your car’s market value, how the policy covers you, and how your premium is calculated, including if:
- you change your address or where you park your car
- your car has existing damage before you buy your policy
- your car is damaged during the policy term
- you or someone else uses your car for ridesharing or deliveries
- you modify your car.
Failing to provide this information to your insurer may lead to rejected claims, reduced payouts, or cancelled policies.
Driving under the influence
Driving under the influence of alcohol or drugs (including certain over the counter medicinal ones) is a safety risk. If you test positive for prohibited drugs or with a blood alcohol concentration (BAC) that’s over the legal limit while driving, any related car insurance claim you make could be rejected and your policy may be cancelled.
Driving an unroadworthy car
If your car is unsafe to drive it can increase your chances of having an accident. Generally, insurance providers place a lot of importance on the fact that they’re insuring a roadworthy vehicle. So, failing to keep your car roadworthy can impact the outcome of your claims. Look out for issues such as:
- worn tyres
- defective brakes
- rust on the body or chassis
- faulty seatbelts
- broken indicators or headlights
- windshield chips or cracks.
Dangerous driving or using your car illegally
Breaking traffic rules, reckless driving, Illegal car modifications or street racing, or using your car to commit crimes can severely impact your policy’s validity. There also may be other recognised illegal activities based on the location that can affect your coverage.
Allowing restricted or unlicensed drivers to drive your car
If you allow someone without a valid licence to drive your car, it can lead to your policy being voided. In the same vein, specifying someone underage on your policy to drive your car and allowing them to do it can impact any claim involving accidents caused by said driver.
Insurance fronting and other forms of fraud
Insurance fronting is a form of insurance fraud where someone falsely lists another person, like a more experienced driver, as a car’s main driver to pay a lower premium. So, when buying car insurance, you must tell your insurer who the primary driver is – that is, who drives your car the most. Providing false or misleading information at any stage, including when making a claim, may result in your claim being declined and your policy being cancelled.
While it’s not a serious breach, not paying your premium on time could lead to a cancelled policy. Your car insurance premium is what keeps your policy alive and kicking. If you don’t make your premium payment within, say, 14 days of its due date, your insurer could refuse your claim. If it’s been more than a month since you missed your premium payment your insurer may cancel your policy.
There are several other potential policy breaches that can void your car insurance. Make sure you check your product disclosure statement (PDS) carefully, as it usually lists the exclusions and conditions that state when your policy won’t cover you.
Helpful tip
If you want more protection against unexpected repair costs, making sure you choose the right level of cover matters. And while it generally costs more, comprehensive car insurance offers wider coverage than any other type of policy. It’s the only type of car insurance that can cover repair costs for your car as well as any third-party property damage even if you’re found at fault. That’s maximum protection for your car and more peace of mind for you!
Adrian Bennett
General Manager for General Insurance
How do I prevent my car insurance from being voided?
You can keep your car insurance from being voided by keeping up with your premium payments, providing your insurer with accurate information, and making sure you’re up to speed on your PDS’ rules. These generally include stuff like not breaking traffic laws and keeping your car in a good driving condition.
Be honest with your insurer
Disclose all the necessary details about your car and situation to your insurance company. Where you park your car, what you use it for, who drives it, any modifications you’ve added or intend to add – they all matter and can save a whole heap or trouble (and money) further down the line. After all, honesty is the best (pun incoming) policy!
Read through your PDS
Grab a cuppa, find a comfortable spot, and ready yourself for some reading. Your policy’s PDS might not be the most riveting read, but it can at least be enlightening. Pay close attention to the exclusions, conditions of cover, and other sections that refer to refused claims or policy cancellations.
Be aware of your local laws
The legal blood alcohol concentration (BAC) limit can vary by licence type. For example, while drivers with a full licence can have a maximum BAC of 0.05, L- or P-plate drivers need to have a BAC of 0.00 in most Australian states and territories. You could check with your doctor about any medication side effects and how it might affect your driving. Also consider checking which car mods or aftermarket parts are illegal in your state or territory.
Keep your car roadworthy
Get your car serviced and checked regularly to identify any potential issues that could make it unroadworthy. For example, you’ll need to ensure that your car’s tyre tread depth is at least 1.5mm – the minimum limit required in Australia.
Pay your premiums on time
Set up a direct debit, ensure that your bank account has enough funds or your credit card is active, or set a calendar reminder if you prefer to pay your premium manually. And even if you miss a premium payment, try to pay it within at least a month of its original due date.
Frequently asked questions
Can my car insurance be voided after an accident?
Yes, your car insurance can be voided even after an accident.
If you make a car insurance claim for an accident, and the insurer finds that you were in breach of your policy’s terms and conditions (say, the accident was due to your car not being roadworthy or you were driving under the influence), your insurer may refuse the claim, cancel the policy, or in serious cases void the policy.
Where can I find the product disclosure statement (PDS) for my policy?
If you already have a policy, your insurance provider should have sent you your policy documents which include your policy’s certificate of currency, target market determination, and (you guessed it) PDS either by post or email, or both.
If you can’t find your policy documents or if you’re in research mode and are comparing policies to buy, you can usually find a policy’s PDS listed on the insurer’s website.
What does a void car insurance policy mean?
A void car insurance policy typically means that your insurer treats the policy as if it never existed because of a breach, like serious misrepresentation of fraud, in the policy’s terms and conditions. Other breaches, though less serious, could still result in a rejected claim or even a full policy cancellation.
To dig deeper – with any insurance product, the insurer can specify circumstances where the policyholder won’t be covered, even if a claim is made for something that might otherwise be considered an insured event. These breaches can lead the insurer to invalidate or deactivate the policy – in other words, void the policy.
There may be other situations where car insurance won’t provide cover – such as general wear and tear, tyre punctures, mechanical failures, or claims your policy level doesn’t include – but that’s not the same as a policy being voided.
Is there an easy way to compare multiple policies?
If you’re in the market for cheaper car insurance cover, there’s an easy way that beats hopping from one insurer’s website to another to manually compare their policies!
Use iSelect’s online comparison tool to compare policies and get car insurance quotes from a range of well-known car insurance brands in Australia, whether it’s a third-party or comprehensive policy you’re after. If you find the policy you want, you can sign up for cover in minutes!
Get started on comparing car insurance policies!
Save time and effort by comparing a range of car insurance quotes with iSelect
iSelect General Pty Ltd (ABN 90 131 798 126. AFSL 334115) has partnered with Compare the Market (ABN 83 117 323 378. AFSL 422926) to compare a range of car insurers and policies. Not all providers in the market or all policies offered by the partners are compared and not all policies or special offers are available to all customers.
A number of our participating general insurance brands are arranged by Auto & General Services Pty Ltd ACN 003 617 909 on behalf of Auto & General Insurance Company Limited 111 586 353, both of which are related entities of iSelect Limited. Our relationship with those companies does not impact the integrity of our comparison service. Click here to view iSelect’s range of providers.
Any advice provided by iSelect is of a general nature and does not take into account your objectives, financial situation or needs. You need to consider the appropriateness of any information or general advice iSelect gives you, having regard to your personal situation, before acting on iSelect’s advice or purchasing any policy. You should consider iSelect’s Financial Services Guide which provides information about our services and your rights as a client of iSelect. iSelect receives commission for each policy sold that is a percentage of the premium or a flat fee. Ask us for more details before we provide you with any services.