Australian drivers have watched car insurance premiums climb year after year, and 2026 brought another rise. Higher repair bills, expensive parts and more complex vehicles have pushed insurers to lift prices across every state. For a household already stretched by living costs, the annual renewal notice has become a genuine budget concern.
This guide explains what comprehensive car insurance costs in Australia in 2026, how prices differ by state and age, the four main types of cover and practical ways to bring your premium down. All figures are in Australian dollars and draw mainly on Canstar’s 2026 research, which analyses thousands of policy quotes.
The National Average
Canstar’s 2026 Car Insurance Star Ratings found that the average comprehensive car insurance premium rose by $111, or about 5%, to $2,460 a year. That followed a 6% increase in 2025, when the average sat at $2,226. Over a longer period, premiums have risen sharply as repair costs and vehicle technology have changed the market.
Canstar also found that switching can pay off. A driver paying the average premium who moves to one of its top-rated policies could save about $651 in a year, cutting the cost by more than a quarter. That potential saving makes comparison shopping especially valuable in Australia’s competitive private market.
Average Cost by State
Victoria remains the most expensive state by a wide margin, with an average comprehensive premium of $3,293 in 2026, up 6% from the previous year. New South Wales follows at $2,792, then the Northern Territory at $2,577. Tasmania recorded the biggest percentage increase at 7% but still sits among the cheaper states.
South Australia and Queensland offer some of the lowest averages, at $2,145 and $2,169 respectively. Western Australia sits at $2,208. Differences reflect local claim rates, theft levels, repair costs and how often severe weather such as hailstorms damages vehicles in each state.
| State or territory | 2025 average | 2026 average | Change |
|---|---|---|---|
| Victoria | $3,101 | $3,293 | +6% |
| New South Wales | $2,676 | $2,792 | +4% |
| Northern Territory | $2,425 | $2,577 | +6% |
| Western Australia | $2,148 | $2,208 | +3% |
| Queensland | $2,112 | $2,169 | +3% |
| South Australia | $2,069 | $2,145 | +4% |
| Tasmania | $1,880 | $2,014 | +7% |
| National | $2,226 | $2,460 | +5% |
Average Cost by Age
Age shapes Australian premiums dramatically. Canstar’s 2026 data shows average comprehensive premiums falling from about $3,158 for men under 25 to roughly $1,451 for drivers aged 50 and over. Young drivers pay more because they have far higher accident rates and less experience on the road.
Older drivers saw the biggest increase in 2026, with premiums for those aged 50 and over rising about 10.26% on average. Even so, drivers in their fifties and early sixties still pay the lowest premiums of any group, which means most adults between 25 and 64 should expect prices below the national average once they pass their mid-twenties.
The Four Types of Car Insurance
Compulsory Third Party (CTP) insurance covers injuries you cause to other people and comes with your vehicle registration in every state. In New South Wales and some other states you choose your CTP provider, while in others the government provides it. CTP does not cover damage to any vehicles or property.
Beyond CTP, you can choose third party property cover, which pays for damage you cause to other people’s cars and property, third party fire and theft, which adds protection if your car is stolen or burned, and comprehensive cover, which also pays for damage to your own car in an accident, storm or flood.
Agreed Value vs Market Value
Comprehensive policies insure your car for either agreed value or market value. Agreed value means you and your insurer settle on a fixed amount when you buy the policy, which gives certainty if the car becomes a total loss. Market value pays what your car is worth at the time of the claim, which can fall short if values drop.
Agreed value usually costs a little more but protects you from surprises, especially with popular used cars whose prices fluctuate. Review the agreed amount at each renewal, because setting it too high raises your premium while setting it too low reduces your payout.
How to Lower Your Premium
Never let your policy auto-renew without checking other insurers, because new customer prices often beat renewal offers. Raising your excess, paying annually, choosing a car with a lower insurance rating, parking in a garage and restricting cover to drivers over 25 can all reduce your premium meaningfully.
Many of these tactics work worldwide, even though policy names and rules differ between countries. Our guide on how to lower car insurance premiums covers eleven proven strategies, including deductibles, bundling and telematics, that Australian drivers can adapt to local policies.
How Australia Compares Internationally
Australian premiums sit above those in the UK and New Zealand. British drivers pay about £562 a year according to the ABI, as our guide to UK car insurance cost explains, while New Zealanders pay around NZ$1,268 for comprehensive cover.
Canada and the United States offer further comparison points. Canadians pay close to CA$2,000 a year on average, and our guide to Canada car insurance cost by province shows how public and private systems affect prices. Our guide to New Zealand car insurance cost covers the market across the Tasman.
Frequently Asked Questions
How much is comprehensive car insurance in Australia? Canstar’s 2026 research puts the national average at $2,460 a year, up 5% from 2025. Prices range from about $2,014 in Tasmania to $3,293 in Victoria, and your own premium depends on your age, location, vehicle, driving history and excess.
Is CTP insurance included in my registration? Yes, Compulsory Third Party insurance comes with your vehicle registration in every Australian state and territory. It covers injuries you cause to others but not damage to vehicles or property, which is why most drivers add third party property or comprehensive cover.
Why is car insurance so expensive in Victoria? Victoria has higher claim costs, more vehicle thefts in some areas and expensive repairs, which push premiums above other states. Victorian drivers paid an average of $3,293 for comprehensive cover in 2026, which makes comparison shopping especially important there.
Final Thoughts
Australian car insurance costs keep rising, but drivers still hold real power to control what they pay. Comparing insurers at every renewal, choosing the right excess and picking the right cover type can save hundreds of dollars a year without leaving your car exposed.
Check your state’s average against your renewal notice, review whether agreed or market value suits your car and get at least three quotes before you renew. Canstar’s latest car insurance cost report breaks down prices by age and state in more detail.