Car Insurance NZ: Providers Compared
Contents (12 sections)
- Types of car insurance in NZ
- Major NZ car insurance providers compared
- Agreed value vs market value
- Excess options and how they affect premiums
- What affects your premium
- No-claims bonus: how it works in NZ
- Glass cover and windscreen
- Roadside assist
- Multi-policy discounts and bundling
- Common questions
- What to do next
- Our methodology
NZ has no mandatory car insurance. Unlike Australia, the UK, and most other countries, you can legally drive in New Zealand with zero insurance. But if you cause an accident that damages someone else's $60,000 car, you're personally liable for the repair costs. ACC covers injury to people, not damage to vehicles or property. Around 70% of NZ vehicles are insured (ICNZ, 2025), which means roughly 30% are not, and if an uninsured driver hits you, their insurer won't be paying your claim because they don't have one.
The NZ car insurance market is dominated by a handful of providers, some of which share the same parent company. Premiums are highly individual (based on your age, location, vehicle, and driving history), so this comparison focuses on features, cover types, and value rather than specific prices.
Types of car insurance in NZ
Three main types of cover are available. Every provider offers all three, though naming and inclusions vary.
Comprehensive
Covers damage to your car and other people's property, regardless of who's at fault. This includes collisions, theft, fire, weather damage, vandalism, and accidental damage. If you hit another car, your insurer pays for both repairs. If a tree falls on your car, you're covered. Comprehensive is the most common type and the most expensive.
Third party, fire and theft
Covers damage you cause to other people's vehicles and property, plus your car if it's stolen or damaged by fire. Does not cover damage to your own car in an accident. If you rear-end someone, their car is covered but yours isn't. If your car is stolen, you're covered. This is a mid-range option that protects against the two biggest non-collision risks (theft and fire) while still covering your liability to others.
Third party only
Covers damage you cause to other people's vehicles and property. Nothing else. Your car isn't covered for theft, fire, or any damage. This is the cheapest option and is most suitable for older, lower-value cars where the cost of comprehensive premiums would be a significant proportion of the car's value.
Choosing a cover type. Most insurers suggest comprehensive for vehicles valued above $5,000, third party fire and theft for vehicles valued $2,000–$5,000, and third party only for vehicles under $2,000. The trade-off is between premium cost and out-of-pocket exposure if you need to claim.
Major NZ car insurance providers compared
| Provider | Parent company | Comprehensive | TPFT | Third party | Agreed value | Market value | Online quote | Roadside assist | Notable feature |
|---|---|---|---|---|---|---|---|---|---|
| AA Insurance | Vero/Suncorp (underwriter) | Yes | Yes | Yes | Yes | Yes | Yes | AA Roadservice (separate membership) | Strong brand trust, linked to AA membership benefits |
| AMI | IAG | Yes | Yes | Yes | Yes | Yes | Yes | Optional add-on | Long NZ history, community-focused brand, wide branch network |
| State | IAG | Yes | Yes | Yes | Yes | Yes | Yes | Optional add-on | Often competitive pricing, same IAG group as AMI and NZI |
| Tower | Tower Limited | Yes | Yes | Yes | Yes | Yes | Yes | Optional add-on | Fully online, risk-based pricing, transparency on pricing factors |
| Vero | Suncorp | Yes | Yes | Yes | Yes | Yes | Broker only | No | Sold through brokers, strong commercial/fleet focus, underwriter for AA Insurance |
| ANZ/Cigna | ANZ Bank / Cigna | Yes | Yes | Yes | Yes | Yes | ANZ customers | No | Bundled with ANZ banking, convenience for existing customers |
| Cove | Cove Insurance | Yes | Yes | Yes | Yes | Yes | Yes | No | Fully digital, monthly subscriptions, no lock-in contracts |
| Warehouse Money | The Warehouse / Vero (underwriter) | Yes | Yes | Yes | No | Yes | Yes | No | Budget-focused, simple plans, linked to Warehouse rewards |
Important note on ownership: IAG (Insurance Australia Group) owns both AMI and State (plus NZI, which focuses on commercial insurance). This means AMI and State share the same parent company, claims infrastructure, and underwriting. Their products differ in branding and pricing but come from the same group. Vero (owned by Suncorp) underwrites AA Insurance policies, meaning AA Insurance is the brand and distribution channel while Vero carries the insurance risk. Understanding these relationships helps explain why some providers feel similar.
Provider detail
AA Insurance is one of NZ's most recognised insurance brands. It's linked to the AA (Automobile Association) but is a separate company underwritten by Vero. AA members often choose it for familiarity, and AA Roadservice (a separate paid membership) provides roadside assistance. Premiums are generally mid-range.
AMI has a long history in NZ and a strong presence in smaller towns through its branch network. It's owned by IAG and often prices competitively. AMI is one of the larger car insurers by policy count in NZ.
State is also owned by IAG and is often the most price-competitive of the IAG brands. It has a more streamlined product range and a strong online presence. If AMI and State quotes differ significantly for the same person, that's the IAG group pricing differently across its brands.
Tower is NZ-owned and listed on the NZX. It has invested heavily in risk-based pricing, meaning your premium is closely tied to your individual risk profile (driving history, location, vehicle type). Tower tends to be very competitive for low-risk drivers and less competitive for higher-risk profiles. It's fully online with no branch network.
Vero sells car insurance primarily through insurance brokers rather than directly to individuals. It's a strong option if you use a broker, but it's not set up for direct online comparison.
Cove is a newer, fully digital insurer. It offers monthly subscriptions with no lock-in contracts, meaning you can cancel anytime. It appeals to people who want flexibility and a modern, app-based experience. Cove's pricing is transparent and its claims process is designed to be handled entirely online.
Warehouse Money offers budget-friendly car insurance underwritten by Vero. Plans are simple with fewer optional extras. It's worth getting a quote if cost is your primary consideration, though cover options are more limited than full-service providers.
Agreed value vs market value
This is one of the most important decisions when taking out comprehensive car insurance, and the one that causes the most disputes at claim time.
Agreed value: You and the insurer agree on a fixed value for your car when the policy starts. If the car is written off or stolen and not recovered, the insurer pays that agreed amount (less your excess). The agreed value stays the same for the policy period regardless of market changes. Premiums are higher because the payout is guaranteed.
Market value: If your car is written off or stolen, the insurer pays the current market value of the car at the time of the claim, as determined by the insurer. This is typically based on trade publications and comparable sales. The risk: you might think your car is worth $15,000, but the insurer's market valuation comes in at $11,000. Premiums are lower because the payout is based on a depreciated value.
When agreed value makes sense: For newer cars (under 5 years old), modified vehicles, classic cars, or any car where you want certainty about the payout. Agreed value removes the dispute about what your car is worth.
When market value makes sense: For older cars where the market value is relatively predictable, or where the premium savings outweigh the risk of a lower payout. Most insurers allow you to choose either option on comprehensive policies.
Excess options and how they affect premiums
Your excess is the amount you pay out of pocket for each claim before the insurer covers the rest. NZ car insurance typically involves two types of excess:
Standard excess: A base amount set by the insurer, often $400 to $500 for comprehensive cover. This applies to every claim.
Voluntary excess: An additional amount you choose to add on top of the standard excess. Common voluntary excess options are $250, $500, or $750. Adding a $500 voluntary excess to a $400 standard excess means you pay $900 per claim but enjoy a lower premium.
Age-related excess: Most providers impose an additional excess for drivers under 25 (typically $300 to $750 extra). This reflects the higher statistical risk of younger drivers.
| Total excess | Premium impact | Who it suits |
|---|---|---|
| $400-$500 (standard only) | Highest premium | People who want to minimise out-of-pocket costs at claim time |
| $750-$1,000 (standard + low voluntary) | 5-10% premium reduction | Most drivers, reasonable balance |
| $1,000-$1,500 (standard + high voluntary) | 10-20% premium reduction | Confident drivers with savings to cover the excess, looking to minimise premiums |
The right excess is a maths question. If adding $500 voluntary excess saves you $200/year in premium, it takes 2.5 years of no claims to break even. A higher excess reduces the annual premium but increases out-of-pocket cost per claim.
What affects your premium
Car insurance premiums in NZ are based on your individual risk profile. The main factors:
Your age and driving history. Younger drivers (under 25) and those with recent at-fault claims pay significantly more. A clean driving record over 5+ years earns the lowest premiums. Some providers (Tower in particular) use granular data on driving behaviour rather than broad age bands.
Your location. Where you live and park your car matters. Auckland, Wellington, and Christchurch CBD areas typically have higher premiums due to higher theft and accident rates. Rural areas are generally cheaper. Some providers factor in specific suburb-level risk.
Your vehicle. The car's make, model, year, engine size, and safety features all affect premium. High-performance cars, cars popular with thieves (some SUVs and utes feature regularly on stolen vehicle lists, NZ Police), and cars without modern safety features cost more to insure. Electric vehicles are increasingly common but can be more expensive to insure due to higher repair costs for battery and electrical components.
How you use the car. Business use, high annual mileage, and commuting long distances increase risk and premiums. Some providers offer low-mileage discounts if you drive fewer than 10,000 km per year.
Security. A garage, immobiliser, or alarm can reduce premiums. Some providers offer discounts for cars with GPS tracking or dashcams.
No-claims bonus: how it works in NZ
Most NZ car insurers offer a no-claims bonus (NCB), sometimes called a no-claims discount, that rewards you for not making claims. The discount increases for each consecutive claim-free year, up to a maximum.
| Claim-free years | Typical NCB discount |
|---|---|
| 1 year | 10-15% |
| 2 years | 15-25% |
| 3 years | 25-35% |
| 4 years | 35-45% |
| 5+ years | 45-65% (maximum varies by provider) |
Making a single at-fault claim typically drops your NCB by 2 to 3 levels. Some providers offer NCB protection as an add-on, which allows you to make one claim without losing your bonus level. This costs extra but can be worthwhile if you have a high NCB.
When switching providers, most insurers will recognise your NCB from your previous provider. Ask for a letter of experience or claims history from your current insurer to present to the new one.
Glass cover and windscreen
Windscreen damage from road chips is one of the most common claims. How it's handled varies:
- Some providers include glass cover in comprehensive policies with no excess (or a reduced excess, often $100 for windscreen replacement)
- Others treat glass claims the same as any other claim, with full excess applying
- Some offer glass cover as an add-on for an extra premium
If you drive on rural roads or highways frequently, glass cover with nil or low excess reduces out-of-pocket cost on the most common claim type. A windscreen replacement typically costs $300 to $600 depending on the vehicle, so paying a $500 excess to replace a $400 windscreen defeats the purpose.
Roadside assist
Roadside assistance (help if your car breaks down, won't start, or you lock your keys in) is handled differently across providers:
- AA Insurance doesn't include roadside assist but is associated with AA Roadservice, a separate membership ($79 to $159/year, AA 2025/2026). Many AA Insurance customers are also AA members.
- Tower, AMI, State offer roadside assist as an optional add-on, typically $30 to $60/year
- Cove, Warehouse Money, Vero do not offer roadside assist
If you already have AA Roadservice or a similar membership, you don't need to pay for a duplicate through your insurer.
Multi-policy discounts and bundling
Most major providers offer a discount when you hold multiple policies (car + house, car + contents, or all three). Typical multi-policy discounts are 5% to 15% (AA Insurance, AMI, State, Tower policy documents).
Bundling is convenient and saves money, but it can create inertia. Check that the bundled price across all policies is still competitive. The cheapest car insurer and cheapest contents insurer may be different providers. The total cost of separate policies can be lower than a single provider's bundle.
Common questions
Is car insurance mandatory in NZ?
No. NZ is one of the few developed countries where car insurance is entirely voluntary. You can legally drive without any insurance. However, if you cause an accident, you're personally liable for all vehicle and property damage. ACC covers injury to people, but not damage to vehicles or property. Driving without at least third party insurance means accepting the risk that a single accident could cost you tens of thousands of dollars.
What's the difference between comprehensive and third party car insurance?
Comprehensive covers damage to your car and other people's property, regardless of fault. It also covers theft, fire, weather damage, and vandalism. Third party only covers damage you cause to other people's vehicles and property, but nothing on your own car. Third party fire and theft sits in between, adding theft and fire cover for your own car on top of the third party liability cover.
How much does car insurance cost in NZ?
Premiums are highly individual. A 35-year-old with a clean driving record insuring a 2020 Toyota Corolla in Wellington might pay $600 to $900/year for comprehensive cover. The same car insured by a 20-year-old in Auckland could cost $1,500 to $2,500/year. The biggest factors are your age, location, vehicle, driving history, and chosen excess. Getting quotes from 3 to 4 providers is the most reliable way to find the best price for your situation.
What is agreed value vs market value?
Agreed value means you and the insurer set a fixed payout amount when the policy starts. If the car is written off, you receive that agreed amount (less excess). Market value means the insurer pays what they determine the car is worth at the time of the claim, based on comparable sales and market conditions. Agreed value gives you certainty but costs more in premiums. Market value is cheaper but the payout may be less than you expect, especially on older cars that have depreciated.
Should I choose a higher excess to lower my premium?
If you have savings to cover a higher excess and you claim rarely, yes. Adding $500 of voluntary excess might save $150 to $250/year in premiums. If you go 2+ years without a claim, the premium savings outweigh the higher excess. But if you'd struggle to find $1,000 at short notice to cover a claim, keep the excess lower and accept the higher premium. The excess is a personal trade-off between premium cost and out-of-pocket risk.
What happens if an uninsured driver hits my car?
If you have comprehensive cover, your insurer pays for your repairs (you pay your excess). Your insurer then attempts to recover the costs from the at-fault uninsured driver, though success depends on that driver's ability to pay. If you only have third party cover, you'll need to pursue the uninsured driver directly for your repair costs, which can mean going through the Disputes Tribunal (for claims up to $30,000) or the courts. About 30% of NZ vehicles are uninsured (ICNZ), so this scenario is not rare.
How do I switch car insurance providers?
Get quotes from other providers before your current policy renewal date. Most car insurance policies are annual. You can switch at renewal without penalty. If you switch mid-policy, check for any short-rate cancellation fees (some providers charge a small fee for mid-term cancellation). Transfer your no-claims bonus by getting a claims history letter from your current provider. Set up your new policy to start the day your old one ends to avoid a gap in cover.
Do I need insurance for an electric vehicle?
EV insurance works the same as any other car insurance, but premiums can be higher. Repairs on EVs are often more expensive due to specialised battery and electrical components, and fewer mechanics are qualified to work on them. That said, EVs have lower fire risk and some have better safety features, which can offset the higher repair costs. Most major NZ providers insure EVs on their standard policies. Tower and Cove have been active in pricing EV-specific risks.
Does car insurance cover items stolen from my car?
Generally, no. Car insurance covers the vehicle itself, not personal belongings left inside. Items stolen from your car are typically covered under your contents insurance policy, if you have one. Some comprehensive car insurance policies cover permanently fitted accessories (like a stereo system or roof rack), but loose items like laptops, phones, and bags are not included. Check your contents insurance for a "temporary removal" or "personal effects" benefit.
What should I do after a car accident in NZ?
First, check everyone is safe and call 111 if there are injuries. Exchange details with the other driver (name, phone, address, registration, insurer). Take photos of the damage, the scene, and any relevant road conditions. Note the time, location, and any witnesses. Contact your insurer as soon as possible, most providers have 24/7 claims lines. Do not admit fault at the scene. If the other driver is uninsured and at fault, you'll still need to report the accident to your insurer (if you have comprehensive cover) or consider filing through the Disputes Tribunal.
What to do next
- Health insurance NZ: Compare health insurance providers and understand what the public system does and doesn't cover
- Life insurance NZ: Compare life insurance providers if you're reviewing your overall insurance position
- PAYE calculator: Check your take-home pay to understand how car insurance fits into your budget
Our methodology
Forge Money does not receive affiliate commissions from any insurance provider. The information on this page is compiled from publicly available provider websites, published policy documents, ICNZ industry data, and Consumer NZ satisfaction surveys. We present facts and let you draw your own conclusions. No provider has paid for placement or favourable treatment on this page. Where providers share a parent company (IAG owns AMI and State; Vero underwrites AA Insurance), we disclose this clearly.
Last updated: 1 March 2026. Sources: AA Insurance (aainsurance.co.nz), AMI (ami.co.nz), State (state.co.nz), Tower (tower.co.nz), Vero (vero.co.nz), Cove (coveinsurance.co.nz), Warehouse Money (warehousemoney.co.nz), ICNZ (icnz.org.nz), Consumer NZ (consumer.org.nz), NZ Police (police.govt.nz). Premiums are highly individual and are not quoted on this page. Get quotes from multiple providers for your specific situation. This is financial information, not financial advice.
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This is educational content, not financial advice.