Every registered heavy vehicle in Australia carries compulsory third party cover. A surprising number of operators believe that is “the insurance”. It is not — CTP deals with people, and stops there.
What CTP Covers
Compulsory third party insurance covers liability for injury or death caused to other people in a motor vehicle accident. It pays for personal injury claims, not for anything that gets broken.
What CTP Does Not Cover
- Damage to your truck.
- Damage to other vehicles or property.
- The load on the vehicle.
- Towing, recovery and clean-up.
- Downtime while the vehicle is repaired.
How It Is Arranged, State by State
- Queensland: CTP is included in the registration fee, and you nominate an insurer from the licensed panel.
- New South Wales: CTP is arranged separately as a green slip before registration — see CTP green slip cover.
- Victoria: included via the TAC charge on registration.
- Other states and territories: arrangements vary, and interstate operators should check that vehicles are registered where they are garaged.
What Sits on Top
- Third party property damage — the minimum commercial cover, protecting you when you damage someone else’s property. On a heavy vehicle that exposure is large.
- Comprehensive motor — adds damage to your own vehicle, fire and theft.
- Public and products liability — for liability arising from the business rather than the driving.
- Carriers or goods in transit — for the freight.
- Downtime — for the earnings the vehicle is not making.
Third Party Property Damage Is Not a Small Cover
A heavy vehicle can damage a great deal in a short distance: several cars, a building frontage, a fuel bowser, a bridge, a rail crossing. The limit under a commercial motor policy is generally substantial for exactly that reason. It is worth knowing the number rather than assuming it.
Comprehensive: Agreed or Market Value
The other decision is how your own vehicle is valued after a total loss. Agreed value fixes the figure at inception; market value is assessed at the time of loss. Specialised or heavily fitted-out vehicles usually favour agreed value — see truck insurance for how this fits the wider programme.
A Worked Scenario
A loaded tipper runs into the back of a car at a set of lights. The car’s two occupants are injured, the car is written off, a bollard and a shopfront are damaged, the tipper’s front end is destroyed and the load is spoiled. The vehicle is off the road for six weeks.
- CTP deals with the injuries to the two occupants.
- Third party property damage, within the commercial motor policy, deals with the car, the bollard and the shopfront.
- Comprehensive deals with the tipper itself.
- Goods in transit or carriers cover deals with the load.
- Downtime cover, if held, deals with the six weeks of lost earnings.
Five different responses to one accident, and registration covered exactly one of them.
The Gap Nobody Notices Until It Matters
Operators who run older trucks sometimes decide comprehensive is not worth it and carry third party property damage only. That can be a rational decision — the truck is written down, the business could absorb its loss. What makes it dangerous is when the same decision is made about a vehicle the business cannot operate without, or where finance is still owed on it. If losing the vehicle would stop the contract, insure the vehicle.
Interstate Operators: Two Things to Check
- Where each vehicle is garaged and registered. Rating, CTP arrangements and compliance all follow it.
- Where your workers perform their work. Workers compensation obligations can arise in more than one state, and the connection test is not simply where the business is based.
Common Questions
If I only do short local runs, is third party property enough?
It protects others but leaves you funding your own repairs. For a business that depends on the vehicle running, that is a large gap.
Does CTP follow the vehicle interstate?
The scheme of registration generally applies nationally, but registration must be in the correct jurisdiction. Garaging address matters.
Is a driver injured in my truck covered by CTP?
Employee injury is normally a workers compensation matter. Do not assume CTP fills that role.
Talk It Through
Request a quote or call 1300 983 940 and we will map out what registration covers and what it leaves to you.
General advice only. This article does not take your objectives, financial situation or needs into account. Consider the relevant PDS and Target Market Determination before deciding on a policy.