Why directasia car insurance so cheap?

[1fast1]

They CAN....

 

The same way they CAN do it the way they have.

 

Why choose one over the other? I wotluld expect that's a highly complex business decision that involves risk, marketing, administration and many other things that can't be discussed, let alone explained effectively in a forum like this.

 

For me, I respect how upfront DA is in being here and answering questions.

 

No other company has the balls for that.

 

Let's not chase them away...

 

That's one way to look at it Darryn.

 

Another way is to look at whether their actions really measure up to their words. Are they still cheap when you include all the contingencies, penalties, etc.?

 

In my experience, I would say 'no'. Although I am fortunate never to have had to make a claim under DA, I was slapped with a penalty when I sold the car that had been insured under DA (the used car dealer included his preferred insurer as part of the deal, so I had little choice without losing more money). I did mention this before in this very thread. I am not saying that DA is technically wrong, but the fact remains that there are other insurers who wouldn't impose such a penalty, or at least waive it off out of goodwill.

 

Frankly, I am *not* impressed with DA. I have no interest in "chasing them away", but if they decide to withdraw as sponsors or simply disappear from this site, I will lose no sleep over it.

Edited June 30, 2015 by Turboflat4

[Fcw75]

Why so many still want to buy from budget insurance?

 

Just get from full service insurance company n save all the headache.

 

If it is just a differences of 100-200, go for the premium insure company.

 

Some just want to get insurance so that they can renew the bloody road tax.

 

Cheap will do, anything that happen later then handle.

[inlinesix]

 

Neither you (nor David) have actually answered my question about why the truthful declaration of average mileage would not be a better proxy.

 

Surely, someone who commutes daily to and from work has a higher risk than someone who uses his car 10X a year (more than the max 5X "business call' exception stated on the DA website) for business calls to an 'ulu' place and occasionally for family weekends (leisure) while taking public transport the rest of the time? Yet the former with a "personal plus commuting" policy would likely pay less of a premium than the latter who's forced to get a "business" policy. Whereas simply going by mileage per year would much more accurately reflect the risk from usage.

 

And before you reply that mileage is too variable to predict accurately, keep in mind that DA prides itself on having a "low mileage" policy. If that's workable, then they can jolly well have policies that adjust by predicted mileage. So, if you stipulate that you put 50,000 km on the car a year, then your claim would be honoured as long as you have not exceeded that (on a prorated basis) by a margin of, say, 10%.

 

Please see my reply above and enlighten us on why you can't directly price by expected mileage?

 

That's why i nvr buy from them. I rather pay more for peace of mind.

[Shibadog]

Why so many still want to buy from budget insurance?

 

Just get from full service insurance company n save all the headache.

 

If it is just a differences of 100-200, go for the premium insure company.

 

 

I can't speak for others, but I have experienced less than satisfactory service by an established insurance company (and their approved repair workshop). Thus I don't believe a "full service insurance company" is better than DA's model - which I don't consider a "budget insurance".

 

in my experience, a "full service insurance company" still does not provide peace of mind in the event of an accident claim.

They CAN....

 

The same way they CAN do it the way they have.

 

Why choose one over the other? I wotluld expect that's a highly complex business decision that involves risk, marketing, administration and many other things that can't be discussed, let alone explained effectively in a forum like this.

 

For me, I respect how upfront DA is in being here and answering questions.

 

No other company has the balls for that.

 

Let's not chase them away...

 

 

DA has not replied to my earlier post http://www.mycarforum.com/topic/2655875-why-directasia-car-insurance-so-cheap/?view=findpost&p=5384416

 

but from my current renewal issue, I guess the answer is clear.

[Fcw75]

Agreed. A full service insurance company can still screw you all over in the event of a claim. Pay more doesn't mean good.

[inlinesix]

Agreed. A full service insurance company can still screw you all over in the event of a claim. Pay more doesn't mean good.

 

It seems like driving in Singapore is stressful as drivers are being screwed from multiple parties.

 

It is best to take B.M.W.

[Shibadog]

 

Neither you (nor David) have actually answered my question about why the truthful declaration of average mileage would not be a better proxy.

 

Surely, someone who commutes daily to and from work has a higher risk than someone who uses his car 10X a year (more than the max 5X "business call' exception stated on the DA website) for business calls to an 'ulu' place and occasionally for family weekends (leisure) while taking public transport the rest of the time? Yet the former with a "personal plus commuting" policy would likely pay less of a premium than the latter who's forced to get a "business" policy. Whereas simply going by mileage per year would much more accurately reflect the risk from usage.

 

And before you reply that mileage is too variable to predict accurately, keep in mind that DA prides itself on having a "low mileage" policy. If that's workable, then they can jolly well have policies that adjust by predicted mileage. So, if you stipulate that you put 50,000 km on the car a year, then your claim would be honoured as long as you have not exceeded that (on a prorated basis) by a margin of, say, 10%.

 

Please see my reply above and enlighten us on why you can't directly price by expected mileage?

 

I'm guessing it's partly due to the difficulty of verifying true mileage on a vehicle. Mileage is easily tampered with. In cases where the ECU is swapped, it's even more complicated.

 

if DA were to price by expected mileage, they would probably need to set up a mileage check program... at start/end of insurance period and perhaps also random spot checks during the period of cover.

 

classifying the type of use is probably intended as a rough proxy for amount of usage. Cheaper and easier to implement.

 

with the future GPS tracking (ERP), who knows? perhaps it will be more feasible to implement a mileage-based insurance premium.

 

[Forte3737]

Yep....Ridiculous for one forumer to say pay more = good. he even said what is 100-200 more? Maybe to him, these few hundreds are nothing. But to most of us, its still hard earned money.

Agreed. A full service insurance company can still screw you all over in the event of a claim. Pay more doesn't mean good.

 

[1fast1]

Why choose one over the other?

I also wanted to answer this more directly (I didn't have the time before). I believe that most people (barring retirees and other people at leisure) are better at estimating their average expected mileage over a year than they are at anticipating what use they're going to put their cars to.

 

So with a reasonable "safety margin" (like the 10% I mentioned earlier) built-in, this is a fairly open and uncomplicated way to assess risk.

 

If someone's circumstances were to permanently change mid-policy, e.g. a change of employment to a much more distant workplace, then it should be possible to inform the insurer in writing of this and pay an additional premium to maintain cover.

 

Contrast this to the difficulty faced by someone who needs to:

 

a) decipher the verbiage on the DA website to see what suits them

 

b) anticipate all the likely uses of the car over the year

 

c) figure out all the traps and pitfalls of insuring for that level of declared use

 

and finally:

 

d) inform the insurer every time *in advance* if they need to break with the policy on an ad hoc basis and hope for their goodwill in permitting it

 

If passenger car usage in "commuting" or "business" were to be *fundamentally, qualitatively* different from "private/personal" use, then I can see your point (and DA's). (An example of a fundamental qualitative difference would be racing/tracking vs street driving). But since the difference is only likely to be a quantitative one, i.e. average mileage put on the car - there's no downside to doing it via my proposal. And there's the upside of avoiding all this needless obfuscation, as I said. The very fact that people savvy enough to frequent a car forum are having trouble with the language and intent of the stipulations on that website should be enough to convince you that the conditions are not reasonably clear enough.

 

I'm guessing it's partly due to the difficulty of verifying true mileage on a vehicle. Mileage is easily tampered with. In cases where the ECU is swapped, it's even more complicated.

 

if DA were to price by expected mileage, they would probably need to set up a mileage check program... at start/end of insurance period and perhaps also random spot checks during the period of cover.

 

classifying the type of use is probably intended as a rough proxy for amount of usage. Cheaper and easier to implement.

 

with the future GPS tracking (ERP), who knows? perhaps it will be more feasible to implement a mileage-based insurance premium.

But (at least in the recent past, and possibly also at present), DA actually had a low mileage policy with lower premiums. I think the limit was something like 8000km/year, although I could be mistaken. I insured my previous second car using that when I was with them.

 

I believe they also allowed drivers to "carry forward" the unused mileage to the next year. This was all done via self-reporting, no objective checks. Don't ask me how they actually verified the mileage in the event of a claim, and whether they prorated it, etc.

Edited June 30, 2015 by Turboflat4

[Othello]

 

Some just want to get insurance so that they can renew the bloody road tax.

 

Cheap will do, anything that happen later then handle.

 

in some cases, not-cheap insurance also screws motorist. So the most important is to open eyes big big and see what one is buying. There is no LOUSY insurance product in the world, just suitable or not

[1fast1]

Yep....Ridiculous for one forumer to say pay more = good. he even said what is 100-200 more? Maybe to him, these few hundreds are nothing. But to most of us, its still hard earned money.

Paying ten dollars for a good, durable umbrella that keeps you dry in the rain is sensible.

 

Paying ten cents for a broken one that gets you thoroughly wet is not.

 

I'm not directing this at DA, BTW, since by many accounts, there are numerous insurers who can play punk at the drop of a hat. But if you've found one that "works" (based on prior claims experience), don't switch from it just because you have a quote from another company that's a couple hundred cheaper. You never know how things will turn out if you actually need to make a claim.

[Fcw75]

 

in some cases, not-cheap insurance also screws motorist. So the most important is to open eyes big big and see what one is buying. There is no LOUSY insurance product in the world, just suitable or not

 

I agreed. I am with DA too...hahaha.

 

The low mileage one.

[Shibadog]

I also wanted to answer this more directly (I didn't have the time before). I believe that most people (barring retirees and other people at leisure) are better at estimating their average expected mileage over a year than they are at anticipating what use they're going to put their cars to.

 

So with a reasonable "safety margin" (like the 10% I mentioned earlier) is built-in, this is a fairly open and uncomplicated way to assess risk.

 

If someone's circumstances were to permanently change mid-policy, e.g. a change of employment to a much more distant workplace, then it should be possible to inform the insurer in writing of this and pay an additional premium to maintain cover.

 

Contrast this to the difficulty faced by someone who needs to:

 

a) decipher the verbiage on the DA website to see what suits them

 

b) anticipate all the likely uses of the car over the year

 

c) figure out all the traps and pitfalls of insuring for that level of declared use

 

and finally:

 

d) inform the insurer every time *in advance* if they need to break with the policy on an ad hoc basis and hope for their goodwill in permitting it

 

If passenger car usage in "commuting" or "business" were to be *fundamentally, qualitatively* different from "private/personal" use, then I can see your point (and DA's). (An example of a fundamental qualitative difference would be racing/tracking vs street driving). But since the difference is only likely to be a quantitative one, i.e. average mileage put on the car - there's no downside to doing it via my proposal. And there's the upside of avoiding all this needless obfuscation, as I said. The very fact that people savvy enough to frequent a car forum are having trouble with the language and intent of the stipulations on that website should be enough to convince you that the conditions are not reasonably clear enough.

 

 

But (at least in the recent past, and possibly also at the present), DA actually had a low mileage policy with lower premiums. I think the limit was something like 8000km/year, although I could be mistaken. I insured my previous second car using that when I was with them.

 

I believe they also allowed drivers to "carry forward" the unused mileage to the next year. This was all done via self-reporting, no objective checks. Don't ask me how they actually verified the mileage in the event of a claim, and whether they prorated it, etc.

 

yes I recall they had a low mileage policy. I didn't realise it has ceased, as it didn't appeal to me. Perhaps they stopped it when they realised the difficulty in enforcing it lol.

 

their current model (complicated TnC) puts the onus on the driver/owner to substantiate his terms of use/coverage in the event of a claim*, and is easy to verify if there is a mismatch. If there is a mismatch, we know what DA will do.

 

If they switch to the mileage-based model, the responsibility shifts to DA to verify the mileage, which as I mentioned above, is fraught with difficulty n cost. This cost is likely to be passed to consumers, which makes their biz case less appealing.

 

*and I'm guessing there's a good chance that the buyers will simply select a usage type without fully reading and understanding the terms at the point of purchase. I.e. it does not deter would-be-customers until sufficient bad publicity is created.

[Fcw75]

The difference can be quite a lot.

 

For a Swift, the difference is $500.

 

NTUC quoted $1300+, DA quoted $800+.

Edited June 30, 2015 by Fcw75

[Directasia]

We still have low mileage.

 

It's not a specific cover type, but an option you can select when signing up. - http://www.directasia.com/car-insurance/ways-to-save/

[1fast1]

yes I recall they had a low mileage policy. I didn't realise it has ceased, as it didn't appeal to me. Perhaps they stopped it when they realised the difficulty in enforcing it lol.

Just to clarify, I was stating that I didn't know if they still had such a policy. Not that they've stopped it. It might well still be around.

 

their current model (complicated TnC) puts the onus on the driver/owner to substantiate his terms of use/coverage in the event of a claim*, and is easy to verify if there is a mismatch. If there is a mismatch, we know what DA will do.

Curious, but how exactly would they ask the driver to substantiate what he was doing when the accident occurred? Do they give drivers the third degree if they make a claim? Do they investigate (PI style, not just motor insurance assessor style)? How would they pick up on a lie?

 

If they switch to the mileage-based model, the responsibility shifts to DA to verify the mileage, which as I mentioned above, is fraught with difficulty n cost. This cost is likely to be passed to consumers, which makes their biz case less appealing.

Not really, they can still note the mileage at the time of inspection when a claim is made. I'm sure something similar is practised for the low mileage policy. Then prorate, add in a safety margin, etc. as I mentioned.

 

Put it this way: dishonesty by the claimant can never be eliminated. But it's far more likely for someone to lie about what they were doing with the car at the time of an accident (e.g. a housing agent saying he was going to the beach rather than going to a house viewing in Changi) than it is for someone to actually roll back their odo just before a claim. This is especially so if you consider that cars that have sustained major accidents are often not mobile enough to move on their own power from place to place so it's unlikely they would have been tampered with at another workshop prior to inspection by DA assessors.

 

*and I'm guessing there's a good chance that the buyers will simply select a usage type without fully reading and understanding the terms at the point of purchase. I.e. it does not deter would-be-customers until sufficient bad publicity is created.

And there's the crux of my argument. The way this confusing stratification of usage is laid out, it's easy to make an error. And any such error will always work in favour of the insurer, not the claimant because it's perfectly legal to deny a claim made under supposedly false representations.

Edited June 30, 2015 by Turboflat4

[L_club23]

 

yes I recall they had a low mileage policy. I didn't realise it has ceased, as it didn't appeal to me. Perhaps they stopped it when they realised the difficulty in enforcing it lol.

 

their current model (complicated TnC) puts the onus on the driver/owner to substantiate his terms of use/coverage in the event of a claim*, and is easy to verify if there is a mismatch. If there is a mismatch, we know what DA will do.

 

If they switch to the mileage-based model, the responsibility shifts to DA to verify the mileage, which as I mentioned above, is fraught with difficulty n cost. This cost is likely to be passed to consumers, which makes their biz case less appealing.

 

*and I'm guessing there's a good chance that the buyers will simply select a usage type without fully reading and understanding the terms at the point of purchase. I.e. it does not deter would-be-customers until sufficient bad publicity is created.

 

Actually, the onus is on buyers to know what they are signing up for...

[inlinesix]

Anybody interested to use Pay as You Drive model?

 

if you are those unker driver type, premium might be even lower.

The difference can be quite a lot.

 

For a Swift, the difference is $500.

 

NTUC quoted $1300+, DA quoted $800+.

 

Is T&C the same?

 

For me, it is more expensive when i adjust it to the same T&C.