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Buying car insurance in Singapore can be a tricky undertaking.
With so many different plans and insurers in the market, you’ll need to choose a car insurance policy that not only offers you protection and coverage but should also be friendly on your wallet.
In the following article, we take a look at five things you should consider before buying motor insurance in Singapore.
1. Your Desired Coverage
There are three different types of car insurance you can buy in Singapore. They are Comprehensive, Third-Party, Fire & Theft (TPFT), and Third-Party Only (TPO). For those unaware, it is mandatory under the Singapore’s Road and Safety Act to have at least a TPO car insurance policy.
TPO is the most basic, and it covers any costs associated with you for damaging someone’s car and their medical expense. It is the best policy for anyone looking for cheap car insurance. TPFT is a middle-tier plan that extends coverage to losses due to accidental fires and theft.
Lastly, Comprehensive car insurance is the most common and well-rounded plan that covers not only third-party, fire and theft liabilities, but also losses and damages to your passengers, vehicle, belongings and yourself.
This goes without saying, but the more coverage you get, the more expensive the premium will be.
If you are driving a COE car (a vehicle that is older than 10 years), you might want to switch to a lower-tiered plan to save some money. After all, there’s a higher possibility of you scrapping your vehicle instead of repairing it after an accident.
2. Policy Excess
Policy excess, more commonly known as deductible, is a sum of money that the insured driver has to pay to the insurance company when a claim is made.
For example, if a driver has an excess of S$500 and the total repair costs is $3,000, the driver is required to pay $500 while the insurance company will pay the remaining $2,500.
This policy excess is usually set in place to make sure the insured person drives carefully on the road. This also prevents drivers from making unnecessary claims such as minor dents and scratches.
Some insurance companies might offer to waive the excess. However, this will often result in a higher premium cost for your car insurance.
3. Coverage in Malaysia
Do you travel to Malaysia often? If you do, you might want to select a car insurance policy that offers coverage and roadside assistance that extends across the Causeway. There are even some policies that cover as far as Thailand.
However, kindly note that these plans are usually not included in the main policy and have to be topped up to enhance your existing coverage. Be sure to check with the insurance company to determine if they offer protection outside of Singapore.
4. Courtesy or Replacement Car
Did you get into an accident with your brand new vehicle? Some insurance companies will replace your vehicle with a brand new one if yours was damaged beyond repair within a certain time frame. Please note that the replacement car has to be of the same make and model.
If your vehicle is not too severely damaged, a courtesy car might be offered to you instead. For courtesy vehicles, you may drive it as long as your car is being repaired.
If neither are being offered, a stipend might be offered instead to help cover the daily cost of transport until your car is fixed. The stipend amount is usually capped at $50 a day for most policies.
5. No-Claim Discount and Premium Rebates
If you're a careful driver and have not made any claims for consecutive years, you'll get to enjoy a No-Claim Discount (NCD). For each year you go without making a claim, you'll enjoy a 10% discount when you renew your policy, up to a maximum of 50%. This basically means if you go five years without filing a claim, your insurance premium is effectively cut in half. Yes, safe driving has it merits after all.
Besides the NCD, some insurance companies also offer premium rebates when a driver fulfils certain conditions during their policy term. Some examples include selecting “preferred” workshops set by the insurer, driving less frequently, or even installing an in-car camera.
Cost always plays a factor when deciding on insurance, and these rebates can help you lower your overall cost for your vehicle.
If you’re looking to buy or renew your car insurance, we can assist you to source for the best car insurance quotes online across our network of partners. Simply visit the following page, and we’ll get back to you with the most competitive car insurance quote with no obligations.
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