Yes, SOAT and similar schemes are mandatory liability insurance policies that are equivalent to the green slip and similar third party personal injury liability insurance needed to register a vehicle in all australian states. Once you take the vehicle out of the country, the insurance would not be valid. Despite opinions to the contrary, most countries try to protect their citizens by having some sort of compulsory liability insurance. Those that don't have other ways of getting even.
Lot of travellers in Americas have little choice but to self-insure their vehicles and hope for the best. Some of the Europeans seem to get comprehensive policies covering their vehicles worldwide but it isn't cheap. Going uninsured may not be wise if you spent your whole life savings on a 500kEuro expedition truck, but most of us have somewhat less invested in our lifestyle and walking away is not quite so painful.
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