How much is car insurance in NZ?
General information, not advice on your situation. Buying through Tower's online quote is direct, without advice. QuoteHub is a Tower partner and Smiths Insurance & KiwiSaver may receive a commission from Tower.
Nobody can give you one honest price for car insurance in New Zealand, because every insurer prices the car, the drivers and the address for itself. Tower says the cost varies from insurer to insurer, and Consumer Protection says a clean licence and no claims make the biggest difference to what you pay, with the type of car also playing a big part. What you can control is the cover level, the excess and how accurately you describe the car and who drives it. This guide takes each in turn so a quote makes sense when you get one.
What your insurer looks at
The Insurance Council of New Zealand (ICNZ) says that for vehicle insurance, rates factor in the motorist's age, previous claims and the make and model of the car, among other things. The premium is the amount you pay for the policy each year.
| What the insurer looks at | How it moves the price | Source |
|---|---|---|
| The car | Make, model and value matter because cars differ in claim and theft rates and repair costs. Modified cars and cars at higher risk of theft cost more. | Tower cost guide, ICNZ tips |
| The drivers | Drivers under 25 and drivers without a full licence pay more. A clean licence makes the biggest difference. | Consumer Protection |
| The address | Crime-related claims and natural hazard data for your area can push the price up or down. Tell your insurer about a locked garage or an alarm. | Tower cost guide, ICNZ tips |
| Claims history | Previous claims count, and so does whether you were at fault. | ICNZ premium page, Tower cost guide |
Age cuts both ways. ICNZ's motor guide says drivers under 25 are statistically more likely to be in accidents, and Tower's cost guide puts it as 30% of serious crashes involving a young driver, though they make up only 13% of drivers. The same guide says drivers aged 30 to 60 with a clean record are probably considered safer, and that from 70 a few more things are taken into account. See car insurance for young drivers for the under-25 end.
Declare modifications: Tower's guide to getting insured says an undeclared one could mean a declined claim and a policy treated as never taken out from the date you should have told Tower. The same guide says to list everyone who drives the car at least once a month, up to five regular drivers. Consumer Protection warns that on a policy with named drivers, a claim is unlikely to be honoured if an unnamed person is at the wheel, whereas Tower's comprehensive wording covers anyone driving with the owner's permission, subject to its exclusions, unless the optional under-25 exclusion is chosen.
Is car insurance compulsory, and how much cover does your car justify?
Tower says it is not a legal requirement to have car insurance in New Zealand. The catch is who pays if you cause a crash. Tower says that if you hit an insured car, that car's insurer will send you the bill on top of your own repairs, and if the other car is uninsured, what you owe comes out of your own pocket. So the useful question is how much cover the car is worth.
Consumer Protection answers that with three drivers:
- In one example, a driver with a $1,000 car chose third party, because the comprehensive quote was almost as much as the car and she was more worried about driving into someone else's BMW.
- In another, a driver with a $4,000 car chose third party, fire and theft, because a few vehicles had recently been stolen from his street.
- In the third, a driver with a $12,000 car chose comprehensive with additional cover, because replacing or fixing it would cost much more than the annual premium.
The cheaper the car, the less the higher cover levels are worth. If the car is under finance, Tower says comprehensive cover may be a loan condition, so check before you drop a level.
What you choose: cover level, value type and extras
ICNZ's motor guide says third party property damage is the least expensive type of car insurance and that, generally, the more extensive the cover, the more expensive the policy.
| Cover | Your own car, per Tower | Where it sits on price |
|---|---|---|
| Third party | Not covered | The least expensive type, according to ICNZ |
| Third party, fire and theft | Fire and theft only | In between, because ICNZ says the more extensive the cover, the more expensive the policy generally is |
| Comprehensive | Accidental damage, fire and theft | Generally the most expensive, according to Consumer Protection |
Third party does not mean small liability cover. Tower's comprehensive wording, which compares all three levels, shows liability protection of $25m on each, which pays for damage you cause to other people's cars and property. What a lower level drops is cover for your own car, so with third party only you pay for your own repairs if you reverse into a wall. The car insurance guide has the full picture, with guides to third party car insurance and comprehensive car insurance.
Value type is the next choice. With market value, a total loss is settled at what the car was worth on the day it was damaged. With agreed value, you and the insurer set a figure that is locked in for the year (Tower's car insurance page). Tower's guide to the two, published in 2020, says agreed value has higher premiums than market value.
Optional extras add to the price too. Consumer Protection lists roadside rescue and excess waivers among add-ons that raise a premium, and Tower's cost guide suggests dropping any you don't need. Timing matters as well: Tower's wording excludes a storm, flood, wildfire, tsunami, volcanic activity or landslide that occurs within 72 hours of the policy start date, and a cyclone that was named before the start date, unless the policy followed straight on from one covering those risks.
What an excess is and how it changes the price
An excess in motor insurance is the part of a claim you pay yourself. Tower's comprehensive wording says it applies to each event that results in a claim, unless the benefit is excess free.
A higher excess generally lowers the price: Consumer Protection says you share more of the risk, and Tower's cost guide says a lower excess typically raises the premium. ICNZ adds that a voluntary higher excess only pays off if you don't claim.
Extra excesses sit on top of the standard one. Under Tower's comprehensive wording, additional excesses apply when the car is driven by an inexperienced driver, by someone with an international licence (unless issued in a country the NZ Transport Agency has identified as eligible to apply for a practical test exemption), or when an additional underwriting excess has been applied, all listed on your certificate of insurance.
Some claims carry no excess. Under the same wording you pay none if you identify the party at fault and Tower is satisfied they were more than 50% at fault, for lost or stolen keys and locks, or when the car is stolen from a locked garage.
ICNZ suggests asking about discounts for holding more than one policy, but Tower says it no longer offers a multi-policy discount on new policies. How to pay less for car insurance lists more ways to lower a quote.
Monthly payments and renewal prices
A monthly price is the annual premium split into instalments. ICNZ's premium page says paying by instalments may cost you more in some cases, while Tower's guide, published in September 2025, says paying annually may qualify for a discount of up to 10%.
At renewal the price can move even if you haven't claimed. ICNZ says premiums across the industry have also been affected by inflation and rising costs for labour, materials and new technology. Check the renewal notice for the agreed value and excess as well as the price.
Getting a quote from Tower online
For a car quote, have the registration number, your licence and claims history, every regular driver and the parking spot to hand. QuoteHub's link opens Tower's online quote, Tower's own quote tool. Other insurers sell car cover too, so a second quote shows how the same details are priced elsewhere. Our guide to getting a Tower quote online has more.
Questions people ask
How much is car insurance per month in NZ?
There is no set monthly figure. Tower's cost guide says the cost varies from insurer to insurer, so the same car and driver can be priced differently. A calculator can only estimate, so a quote on your own details is the figure that counts.
Do I have to have car insurance in NZ?
No. Tower says it is not a legal requirement in New Zealand, but you would pay out of your own pocket for damage you cause. See third party car insurance for the minimum sensible level.
How do I compare two quotes fairly?
Line them up on cover level, agreed or market value, the excess including any extra excesses, optional benefits and how you pay. ICNZ says not to buy on price alone, because policies differ in their benefits and exclusions.
Will my premium go up after a claim?
It can. Tower's cost guide says a premium may rise at renewal after an accident, and by how much depends on whether you were at fault and how often you have claimed. ICNZ's motor guide describes an extension under which the insurer waives your excess and keeps your no claims discount if an uninsured driver damages your car, provided that driver is identified and acknowledges the accident.
Can I cancel if the price is not what I expected?
Tower's comprehensive wording gives a 15-day free look, so if you cancel within 15 days of the start date and haven't claimed, it refunds the premiums you paid.
Adviser's view
QuoteHub's read: the price is built from your car, your drivers, where the car is kept and the excess you choose, so only a quote on your own details gives a real figure.
Get a Tower quote online
Tower’s own quote opens in a new tab. House, contents, landlord, car and boat cover can be quoted together in one go.
Tower Easy Save: save $400*
- $200 off house or landlord
- $100 off comprehensive car
- $100 off contents
*$400 is made up of individual policy discounts, each available separately. New, eligible policies only with promo code EASYSAVE. Excl. contract works. Ends 30 Jan 2027. Ts&Cs apply. Tower’s Easy Save terms, checked 6 October 2026.
QuoteHub is a Tower partner. If you buy through this link, Smiths Insurance & KiwiSaver may receive a commission from Tower. Buying online is not financial advice.
Cite this page QuoteHub NZ (2026). How Much Is Car Insurance in NZ? What Sets the Price. www.quotehub.co.nz/car-insurance/car-insurance-cost-nz. Updated 2026-10-07.
References
- Tower: What affects car insurance costs in NZ?
- Tower: What you need before insuring your car
- Tower: Car insurance, market value vs agreed value (published 13 November 2020)
- Tower: Can I drive an uninsured car?
- Tower: Car insurance
- Tower: Car insurance comprehensive cover policy wording (09-24)
- Tower: Multi-policy discount
- ICNZ: Motor insurance, what you need to know
- ICNZ: Tips to reduce your motor insurance premiums
- ICNZ: What makes up your premium?
- Consumer Protection (MBIE): Car insurance
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