Your lender requires it, your business depends on it. Here's everything you need to know about insuring financed trucks, equipment, and machinery in Australia.
When you finance a truck, excavator, or any business asset, your lender will almost always require comprehensive insurance for the life of the contract. If the asset is written off or stolen, the insurer pays the lender — not you. Without insurance, you'd owe the full remaining balance on a vehicle you can't use.
Beyond lender requirements, the right insurance cover protects against:
Most finance providers require the following at settlement:
If your policy lapses, many lenders will apply their own "default" or "contingency" insurance. This typically costs 3–5x more than a standard policy and provides minimal cover. Always maintain your own policy.
| Cover Type | What's Included | Who Needs It |
|---|---|---|
| Comprehensive | Damage, theft, fire, third-party | All financed assets (required) |
| Third-Party Fire & Theft | Fire, theft, third-party damage only | Fully owned assets only |
| Plant & Equipment | Specialised cover for stationary/mobile plant | Earthmoving, cranes, generators |
| Marine/Transit | Cover while in transport to site | Equipment delivered to job sites |
| Business Interruption | Loss of income while asset is off road | Owner-drivers, single-truck operators |
The major commercial vehicle and equipment insurers in Australia include:
For the best pricing, use a specialist commercial insurance broker or online comparison platform rather than going direct. Brokers can access wholesale rates not available to the public.
If your financed asset is written off, the insurer pays market value — but you may owe more than market value to the lender (especially with low deposits or high balloon payments). Gap insurance covers the difference.
Gap cover is especially relevant for:
You can almost always choose your own insurer. The lender just needs to be noted as an interested party. Using your own insurer is usually cheaper than the lender's recommended or default policy.
Yes. Insurance premiums on business assets are fully tax deductible as a business expense. The GST on premiums can also be claimed as an input tax credit if you're GST registered.
Your lender will likely apply expensive default insurance (3–5x the normal cost) and debit it from your account. In extreme cases, failing to insure can trigger a default on your finance contract.
Under a finance lease, the lessor owns the asset but typically requires you to arrange and pay for insurance. Under an operating lease, insurance is sometimes bundled into the lease payment — check your contract.
Our calculator includes repayment costs — factor in insurance when comparing total cost of ownership.
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