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Car Insurance FAQs
Why I shouldn't renew my car insurance using my present motor insurer?
What period in advance will I be looking for my car insurance renewal?
There are three types of car insurance policies that are available and can meet your requirements.
The main motor insurance coverage includes:

Comprehensive Cover
This one covers for the replacement or repair of your car when stolen or damaged, in cases of vandalism, accidents or weather-caused damages. The coverage also covers accident related loss, accessories and spare parts damage and third-party claims for the damage to people or property.

A third party, theft and fire cover
This coverage covers the damage done by your car to other people's property or vehicles. In addition, it covers the vehicle if it's damaged by fire or stolen.

3rd party cover
Liability claims are covered from the third party for injuries, damage to the properties or their vehicles by your car. It is ideal to cover under the comprehensive cover because it covers for both the third party as well as your personal damage in case of an accident.
Whom do I pay my insurance premium?
The insurance premium is paid directly to the motor insurance company of your choice once you decide for the comparisons we give you.
Ways in which I can renew my road tax?
You can choose to renew it through Online Banking, AXS machine and Singapore Post Office.
What is insurance excess?

The deductible is also known as the excess. It is the first sum of the claim that the insured must bear. Let's take a scenario where the insured has a deductible of $500 and the full repair cost is $3000. The insured will pay the $600 and the insurer pay the remaining amount of $2500.

How will excess affect my premium?

Having lower deductible will cause higher premium payments. However, some insurance companies are likely to waive off the excess in cases where you benefit from 40% to 50% NCD. It solely depends on the insurance company and therefore you should look for an insurance that gives low excess and competitive insurance premium.

Is there a reason for the existence of excess?

The insurer imposes the excess as some form of co-insurance. With the existence of deductible, the insured tends to be more cautious because when the claims happen, the insured will be forced to go back into their pocket and add a given amount to the claim. High excess tends to make the insured more careful lowering the risk of having any claim.

Mostly I see terms for example Excess: $500 dedicated to Section1 only? What is the meaning of the "Section1 only"?

The motor insurance policy is broken into various sections. Section1 covers personal claim damage. When you get a comprehensive insurance cover, it covers for own damages. It covers your car if it damaged. In such a case, you may get the insurance company to compensate for the damages whether it is your fault or not.

The Excess: 500 (section1 only) means that the damage is only applicable to the own damages only. For example, if you hit another car and your vehicle damages are $6000 and the 3rd parties accrue to $8000, then the deductible $500 will only be applicable to your own car's damage. The insurer will have to pay $5500 for your car. The motor insurer will also have to pay the total amount which is $8000 for the third party's damage.

In some instances, I notice terms for example Excess: 500 dedicated to section 1 and 2 separately. What does that mean?

The section two in the policy is meant for the 3rd party claims. It means there are the deductibles on section 2 also for the 3rd party claims. If there is a third party claim, then the excess is applicable here. Using the example is given on above (section ix), you will pay $500 and the insurance company pays $5500 for your own damages of $6000. The 3rd-party claim payments will be as follows: you will pay $500 and the insurer will pay $7500 for the claim of $8000 third-party damages.

What does $500 (all claims) refer to?

When you see this, it means that the total deductible is applicable for all the accidents. Using the similar example in section 9, you will be expected to pay $500 whilst the insurer will have to pay $13500 for the total damages which are $14000. This covers the third party damage and your own damage.

Is it a common scenario to have the section 1 and 2 separately and all claims excess basis?

Such excess isn't common. The insurer imposes such excesses for special cases such as when the car is on higher performance or it is a luxury vehicle. The insurer can also impose the same if the insured profile isn't favorable.

What is NCD and how is it likely to affect my premiums?

In cases where you haven't made a claim in a span of one year, you are allowed to a No-Claim Discount commonly known as NCD. The No-Claim Discount reduces your following year's premiums. It is an effective way used by insurers' to determine the careful drivers. Below, the table showcases how the different insurers in the industry have set the NCD.

Claims throughout the period of insurance NCD on renewal
1
2
3 or more
50%
20%
Nil

It is vital to check with the insurance company whether the No-Claim Discount is available.


Prior to making a claim, it is necessary to consider if the entire repair costs are lower than the existing discounts on your premium.
If the total repair cost is lower than the premium discounts, then it is safe to pay off the repairs on your own than make the claims.
The table below shows how much money off on the premium you receive after making any claims.

Private car policies Motorbike and Commercial vehicle policies
Period of insurance with no claim
1 year
2 years
3 years
4 years
5 years or longer
Discount on renewal
10%
20%
30%
40%
50%
Period of insurance with no claim
1 year
2 years
3 years or longer
Discount on renewal
10%
15%
20%
Am I likely to lose my NCD in cases of a break in ownership of my car?

Many insurance companies in Singapore would permit you to keep the NCD for a period of 24 months. Some of the insurers have set the period for about 12 months. It is vital to contact the insurer and ask for detailed information rather than assuming.

What am I supposed to do following a motor accident under MCF?

With Motor Claims Framework , it is important to know what you are supposed to do following a motor accident. Given below are instructions from the General Insurance Association MCF presentation.
First, if anyone is hurt, you should call the emergency immediately.

A police report must be made in 24 hours if the accident is a hit and run, involves a foreign registered vehicle or the damage is done to a govt property or vehicle.

The involved parties should exchange their information which includes their name, ID number, address, telephone number, vehicle number, and insurer. If witnesses are there, their contact information should be noted too.

You should take photos of the vehicle and the accident scene if you have a phone camera or a digital camera.

When sending the photographs via multimedia messages, enter 97112758, the number of the vehicle and the day of the accident. After that, you will get an acknowledgment message from the GIA (General Insurance Associaltion) record center.

You should then contact your insurer for the tow truck service or further guidance on how to control the situation. It is vital to avoid unauthorized repair workshops and tow-truck operators.

Call your insurer's hotline for a tow truck or for further advice on how to handle the accident. Avoid all unauthorised tow-truck operators or repair workshops.

Report the accident and take your accident vehicle, whether damaged or not, to the approved reporting centre (provided by your insurer) within 24 hours or by the next working day.

You should carry with you a complete Singapore Accident Statement which has two forms. You may also ask the authorized workshop or the approved reporting center to assist you in filling the forms.

Avoid discussing which party is at fault. Refer all communication from the other drivers or their lawyers to your insurer. Do not authorise any repair work without the consent of your insurer.

You should avoid discussing who is at fault after an accident. You should refer all communications from the other party or their legal attorneys to your insurer. You should not accept any repair work without the permission of your insurance company.

A full MCF presentation slide is available on our website from the download centre.

Is there a premium difference without the COE?

If the total insured doesn't include the COE, the insurer is expected to give a 5% concession off the basic premium calculated from the basic value of the vehicle as per the insurance general practice.

The reason behind this is that the amount insured doesn't affect the price of the premium as much as people might consider. Most of the insurance claims are for the repairs and not the total loss. As a result, the premium pricing components are considerably low since the bulk of the charged premiums are used in payment of partial loss.

What factors affect the premium?

An insurer tables a lot of considerations when calculating insurance premium. The majority of the premiums are based on the basic 3rd party which has the extra cost added. The main determinant of the cost of the insurance is what you like to be covered. Below are the determining factors:

Licence
The license makes a big difference whether it is provisional or full license. You can be expected to pay higher a lot more extra amount if you just own a provisional license.

The age and size of the car
The car's age and the engine capacity play a major role in deciding the price of the premium. Older cars have some difficulty when to insurance. Most insurance companies consider that the old cars are more prone to accidents and other damages. A new car is costly to replace and thus will cost extra to insure compared to an old car. Similarly, the more powerful car you have, the expensive it will be to insure.

The driver's age
The old and the young drivers are in the high-risk categories and therefore more for the insurance.

The car's value
TThe value of the car is accounted for fire, theft, third party, and comprehensive insurances. It is important to note that what you've the vehicle insured for isn't every time what the insurer will pay in case of a claim. If the car is written off, the insurer will pay for what they think the vehicle is worth which in most cases is less what the vehicle is insured for. There is a little gain that comes with over insuring a vehicle. However, you should also not under-insure your car.

Your experience
The insurance company if you've had insurance in the past or if not, if you've driven under someone else's insurance without causing an incident. It is vital information that is considered when calculating the premium. It is less expensive when you have a clean driving record and some insurance experience.

Profession and uses of the car
Some professionals are taken to be of high risks than others thus having a higher load on the premium. The use of the car is also considered when calculating the premium. A basic policy cover will cover the car for domestic, pleasure and social purposes. It does not cover for carriage. When the vehicle is used for the business, the loading will be applicable. If it is for commercial use, the load imposed will be higher.

Extra and excess
Most of the insurance companies have the excess clause. It implies that the insured agrees to be responsible for an agreed sum in case of a claim. The premium would be costly if the clause is removed. It is important to research the market before taking a cover because what one insurance company considers extra can n be standard to another insurance company.

No claims bonuses
The no claim bonus is built over the years and it gives the insured some reduction in the price of the premiums. The no claim bonus ceiling is 50% leaving an insured that has never filed a claim without it affecting their no claim bonus.

Why is my premium higher while the market price for my car is depreciating?

The premium for the motor insurance is computed using some factors for example the driver's age, vehicle capacity, model amongst other factors.
The market price of the car is not used as a direct factor as it doesn't have any influence on claims lodged by the third party for injuries and property damage.
The repair cost of the cars is increasing hence the need to have an increase I the premiums as a way of sustaining the business.

Why is my renewal premium higher even when I have not made a claim?

Insurance is primarily based on the approach of pooling of risks. In case the overall claims are bad then the premiums shall be going up across all motorists regardless whether they have made a claim or not. However, those who have a clean driving record will have lower premiums than those who have accident claims. Such will have an extra loading on their claim and therefore have to pay a higher premium.

Is there a difference between any workshop scheme and authorized scheme?

Singapore has two kinds of car insurance scheme; the authorized workshop and any workshop. The authorized scheme has lower premiums because the insurance company has control over of the repair cost. Most cars in Singapore are covered under this scheme. People who go for any workshop scheme are those that own super model cars which are only fixed in specific workshops.

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Car Insurance Glossary
Here are some Car Insurance terms for you.
The cost associated with the type of your car insurance plan – ranging from Third Party to Comprehensive – and can span from any specified period up to 1 year.
What you have to make in an incident where injury is involved or when the other party refuses a private settlement.
What you have to pay when making a claim, but only when you’re at fault. If your claim is $3,000 and your excess is $500, you’ll only fork out that $500 while your insurer pays the other $2,500.
A reward percentage off your premium if you’ve not made any claims from the year prior. With every year, NCD increases by 10% and this can accumulate up to 50%.
Workshops approved by your insurer to perform repairs, if your plan has such a restriction in the event of damage incurred. If you have a preferred workshop or just want to get your car fixed at the nearest place, seek a plan that allows it. However, these may demand higher premiums.

For more information buying insurance, types of cars and recommended repair workshops, read our blog here.
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