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Property damage and insurance

What happens if there is property damaged as a result of a vehicle accident and the person has insurance.

It is not compulsory for the owner of a motor vehicle to take out insurance for property damaged as a result of a motor vehicle accident.

If the vehicle is insured, the insurance company must be notified of the damage as soon as possible.

See Making a claim for property damage.

Various types of insurance

The different types of insurance available are:

Comprehensive insurance

This insurance covers the cost of:

  • damage to the owner's vehicle
  • damage caused to other vehicles
  • property such as traffic lights, fences, etc. and
  • other anciliary costs of other parties such as towing or car hire

Third party fire and theft insurance

This insurance covers the cost of:

  • fire and theft of the owner's vehicle, and
  • repairs to damage caused to other vehicles and property if the person insured was at fault.

This level of insurance does not cover the cost of repairs to the owner's vehicle.

Third party property insurance

This insurance covers the cost of repairs to other people's vehicles and property if the person insured was at fault.

Uninsured motorist extension

Many insurance companies offer the uninsured motorist extension (UME) in their third party fire and theft and third party property insurance policies. This covers damage to the owner's vehicle up to a set amount (usually around $3000 to $5000) if the owner is not at fault and their vehicle is damaged by an uninsured driver. The insurance company must be satisfied that the owner is not at fault and the owner must provide the uninsured driver's name and address.

Finding fault

The driver of a motor vehicle should not admit liability for the accident at the scene.

They should wait for the determination of their insurance company or come to an agreement with the other party after legal advice, arbitration or mediation.

The insurance company will need evidence to help them determine who is at fault.

See Gathering evidence.

The blame for the accident will be apportioned depending on the agreement between insurance companies or the parties (vehicle/property owners). There are instances where one party will be completely in the wrong, for example, where a parked car is damaged by another motorist.

More information

References

Motor Vehicle Accident Manual

Ali Yildiz from Footscray Community Legal Centre has developed a comprehensive manual to help assist clients who are being chased be insurance companies.

Note: This manual is no longer available.

Lawyers Practice Manual

Legal Online's Lawyers Practice Manual has information about making a property damage claim in the Magistrates' Court.

See Motor vehicle property damage claims in the Magistrates' Court [3.3.101](opens in a new window).

Acknowledgement

Content on this page was originally adapted from Motor Vehicle Accident Manual, 2012. Thanks to Footscray Community Legal Centre inc and to Ali Yildiz and Denis Nelthorpe.

Thanks to Matthew Martin, Senior lawyer, WEstJustice for assistance with review in April 2019.

Updated