Yes, it is illegal to not insure your car in Australia to a certain level, but the legal requirement is only for Compulsory Third Party insurance, not comprehensive insurance. Every registered vehicle in Australia must have CTP insurance, also called Green Slip in New South Wales, Motor Accident Injuries insurance in Queensland, or Transport Accident Charge in Victoria. CTP is a legal requirement under state and territory road transport legislation, and you cannot register or renew registration without it. If you drive without CTP, you face very heavy penalties. In NSW, driving an unregistered vehicle, which automatically means uninsured for CTP, can result in fines of $1,300-$2,800, loss of demerit points, and vehicle impoundment. If you have an accident while uninsured for CTP and injure someone, you become personally liable for potentially millions of dollars in medical and care costs, which the Nominal Defendant will pay to the victim and then recover from you. However, it is not illegal to drive without comprehensive, third party property, or third party fire and theft insurance. Those are optional. It is legal but financially very risky, because if you cause an accident and damage a $100,000 car or a building, you must pay for it yourself. Most financial advisors strongly recommend at least Third Party Property cover for this reason.
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