Two Things To Look Out For When Buying Car Insurance in Singapore And One Way to Reduce Your Premiums

black and white picture of a vintage car with a dent

First things first, car insurance is mandatory in Singapore. According to the Motor Vehicles (Third-Party Risks & Compensation) Act, it is compulsory for one to purchase a car insurance plan for coverage if you want to drive on the roads. The insurance must at least cover the injury or death caused by your vehicle. 

If you are found not to have insurance, the consequences could be dire. You can get fined up to $1000, jailed up to 3 months, or both. You will also be banned from holding or obtaining a driving license for 12 months from the date charged.

So if car insurance is a purchase you are going to have to make sooner or later, here are the two things to look out for when buying car insurance, and one way you can reduce your premiums. 

 

1. Coverage 

The first thing you want to think about is what kind of coverage you need. There are typically three kinds of coverage that insurers provide in Singapore: Comprehensive, Third-Party, Fire & Theft (TPFT), and Third-Party Only (TPO). 

Let’s start with TPO. TPO coverage is the most basic coverage. It covers any damage done by you to another person or vehicle while on the road. In the event that you get into an accident, this covers the car repair and medical expenses you owe to another person. This type of plan is the bare minimum the Singapore Government accepts if you will be on the road. It is also the most affordable, making it good for those on a budget. 

Next is TPTF. Think of this as the middle-tier plan. It covers everything TPO does but also provides additional benefits such as coverage from losses due to accidental fire or in the event of theft. Naturally, this is slightly more expensive than TPO. 

Lastly we have comprehensive coverage and as the name suggests, this type of plan is meant to be comprehensive. It covers many other things apart from what TPO and TPTF plans cover. For example, this covers damages to your car, your belongings, and most importantly, yourself and your passengers. This makes it the most well-rounded and also the most commonly used plan. 

2. Policy excess

Another important thing to take note of is the policy excess associated with a plan. Policy excess is the money the insured driver has to pay the insurance company when filing for a claim. This is also called a deductible, and usually comes in percentages. 

For example, if the deductible is 10% and the total cost of repair is S$1,000, the insurance company will pay S$900 while the driver will be required to pay the remaining S$100. 

Usually low premium plans have high deductibles, so be sure to check thoroughly before purchasing a plan. 

Lastly, we have one tip to help you reduce your premiums. The secret ingredient is making full use of your no-claims discount and getting as many rebates as you can. 

If you drive carefully and do not make any claims for consecutive years (this differs from provider to provider), you can enjoy a no-claims discount of up to 50%. 

Besides this, companies also offer lower prices for drivers that comply with certain conditions. For example, you may need to select a repair workshop prescribed by the company, or be required to install an in-car camera. If you do so, you will be subject to more rebates and less premiums. 

For more tips, tricks, and general information on car insurance, be sure to take a look at our page which provides you the most complete information on car insurance.  

Three Things Car Owners Need to Know About Car Insurance in Singapore

two graphic man and woman shaking hands in front of a car

From fatal accidents to car insurance in Singapore, there is so much car owners need to think of. There are many things on the line: personal safety as the driver, safety of those in the car, and safety of your wallet.

Owning, maintaining, and paying for car insurance in Singapore is expensive. Most of you have learned this the hard way. After forking up hundreds of thousands to buy a car, you realize that keeping it working, and keeping yourself safe on the road is no joke.

There are also far too many things that can go wrong which only add to your financial burden.

You may be on the highway stuck in a jam due a car accident thinking that that could never be you. Yet, car accidents have soared by 25% in 2021. Research has also shown that Singapore is more dangerous than its peers around the globe. Car repairs and medical expenses after accidents can be a lot.

Furthermore, car loss or theft is quite rare in Singapore, given our country’s small area and low crime rates. Even so, the probability of it happening to you is never zero.

All this added up can amount to a pretty penny over the years, which is why so many car owners turn to car insurance. Car insurance is a product many rely on to protect them, their families, and their hard-earned cars. Before you jump the gun, there are a few things you need to know about car insurance in Singapore. 

First, you need to know the exclusions. Some exclusions are standard like if you don’t have proper certification or if you are under the influence of alcohol. Other exclusions vary from provider to provider and plan to plan. For example, some plans exclude insurance coverage for diplomats or foreigners. Some exclude coverage for those of you who drive around on private land. Some exclude coverage for damage to tires or rims. So before you buy, make sure to read the exclusions of the policy and pick a plan ideal for you.

Second, you need to be aware of your premiums. Premiums for car insurance are not standard and can vary based on your age, gender, and habits. If after evaluation you are deemed a high-risk driver, you will be charged higher premiums. Being a young driver who has received your license recently drives up your premiums. Driving during peak hours (7am to 7pm) increases them too. So, it is important to see what extra costs you are subject to and plan accordingly.

Lastly, you should consider add-ons. For some of you out there, standard plans may not be enough. Most if not all insurers provide customisation services. So, if you are a new driver or have specific habits that you would like coverage from, add-ons are a great option. 24 hour roadside assistance and overseas medical allowance are some of the many add-ons available for you. Check with your insurer to see what choices they have and which are best suited for you.

All in all, car insurance is a product that you can benefit immensely from, provided you know what to look out for. Being in the know about how car insurance premiums work ensures that you can secure the best policy at the lowest possible cost. Head over to this resource to get started. 

Finding Your Car Insurance Needs

close up of grey car in a car accident

Car Insurance on a Budget

With increasing cost of living, rising gas prices and inflation in Singapore, the last thing you need is a car insurance policy leaving you paying for services you don’t need. Here’s how to pick what car insurance will have the services you need.

Would You Repair Your Car?

Car insurance policies often provide liability covers for damage to 3rd parties. However, if you do not intend to repair your car, paying for comprehensive car insurance that covers the repair cost of your car would be a waste. On the other hand, a 3rd party only insurance policy will save you the money of protecting a car you have written off whilst still covering you from the brunt of the liability costs. Some insurances cover 3rd party, fire and theft, so that your car will be covered if it can neither be scrapped or repaired.

Coverage for Passengers

Another consideration is the number of people that you expect to use the car, either as drivers or passengers. Some insurance policies offer coverage for passengers, but many others only cover the drivers. Even within this group, some policies only cover the main driver during the event, whilst some others cover all named drivers of the vehicle. Furthermore, there is also great variety amongst how the passengers of the vehicle are covered, a concern for anyone purchasing a policy for a family vehicle. 

Crossing Borders

Borders may also be a concern for those who frequently drive over the channel for work or leisure. Some insurances now cover your vehicle in parts of Malaysia or even parts of further off countries like Thailand. This could be of particular concern for anyone who frequently travels

Driving Experience

Last but not least is experience, though the new driver may want coverage for a wide variety of accidents, the more experienced driver may feel it less necessary to cover all scenarios no matter now unlikely. Insurance coverages now have a collision only option, where only vehicle on vehicle collisions are covered. Experienced drivers, who feel confident in their abilities not to succumb to an unforced error, may feel that vehicle on vehicle coverage with their insurance to be sufficient.

Other Benefits

This list of benefits is by no means conclusive, and many other benefits may beg for your consideration in your unique circumstance. For instance, some may feel it necessary to consider a loss of use coverage if travel costs in their area are expensive. Alternatively, coverage for lost personal belongings may be attractive to someone who’s livelihood is totally reliant on their personal artifacts. Other niche requirements can be met as well. For a vehicle that is frequently passed between several persons for example, an insurance policy that does not require the naming of driver is greatly beneficial.

 

In Singapore, a combination of factors including your vehicle use, your willingness to repair your vehicle and experience as a driver will determine what’s your best car insurance.

Basic Guide to Car Insurance

Ford car that got into an accident

Car insurance is designed to protect you, your family and your vehicle when your car is damaged or if you are involved in an accident on the road. The coverage also protects your assets when you are found responsible for causing the accident.

Car insurance can come with a hefty price tag. However, do not make the mistake of opting out just to save the extra money. This mistake may cost you more when you end up in a car crash or have damage to your vehicle that you are not responsible for.

Although car insurance sounds complicated, it is mostly comprised of three different policies. Read on to understand more about the differences and whom they are for.

 

1. Third-Party Only (TPO)

Third-party car insurance, also commonly known as ‘third-party only’ (TPO) car insurance in Singapore, provides you with the minimum legal requirement to drive, and it is also the cheapest car insurance available. 

TPO provides coverage for others when you cause damage to their vehicle, but you would have to pay for your own damages. TPO is paid only when your fault has been proven. This gives you cover if someone else claims against you in the event you cause an accident or any damage when driving.

2. Third-Party, Fire and Theft

Third Party, Fire and Theft car insurance covers for legal liability to the third party as well as damage to your own car as a result of fire or theft only. 

The Third Party, Fire and Theft car insurance plan is a good in-between plan for those who don’t want the full benefits of comprehensive car insurance, but still want to be covered against incidences of fire and theft.

3. Comprehensive

Comprehensive car insurance provides the broadest coverage among the three, and is also the most commonly chosen option in Singapore. The comprehensive car insurance covers yourself and other parties for death or injury, medical costs coming from the accident, damage to property and other accidents like fire and theft.

The Comprehensive Coverage is required by the vast majority of banks for the approval of car loans. Hence, if you are seeking to apply for a car loan for the banks, you are most likely to apply for comprehensive car insurance. 

 

Additional Coverage

You can also opt for additional coverage by paying a slightly higher price. These coverage includes windscreen damage, damage arising from riot, strike and civil commotion, damage arising from flood and windstorm, liability of passengers for acts of negligence, personal accident benefits for passengers and no-claim discount protection.

 

Total Costs 

Car insurance is pricey and they are mandatory, making them an unavoidable yet hefty cost. The price could range from S$700 to S$1,000, or even more for a year’s coverage. 

Car insurance premium is calculated on a case-by-case status. Some factors that could contribute to your annual premium include age, gender, marital status, occupation, driving experience, age of car, car usage and many more.

Get quotes from several car insurers to pick the best price for your profile and car. However, do ensure that you are sufficiently covered and you have avoided horrible terms and conditions. 

Choose the type that suits your needs, desires and wallet best. To view the best car insurances in Singapore, click here.

Consequences of Driving Without Car Insurance in Singapore

insurance policy paper with magnifying glass

In Singapore, the price of car insurance depends heavily on many factors. Most importantly, it can skyrocket in premiums especially if you were involved in any accidents recently, or have any offences on your driving record. Even for someone with a clean record, the average cost of car insurance can range from S$700 to exceeding S$3,000. 

However, attempting to drive without car insurance is risky and could instead end up costing you many things. Penalties might include thousands of dollars, your driving licence and even jail time. But what does the law say exactly regarding the consequences of driving without insurance?

 

Legal Consequences

The Singapore Motor Vehicles Act states that someone found driving a motor vehicle in Singapore without insurance coverage will be guilty of an offence. The law penalises uninsured drivers to the tune of a S$1,000 fine, a prison term of up to three months, or both. Additionally, the driver might suffer the loss of driving privileges for up to twelve months

By choosing to contravene the law, you could find yourself paying a much higher price than the couple hundred, or couple thousand dollars, you might spend on a car insurance premium.

However, there are several exceptions to this law. You will not be found guilty of this offence if:

  • If the car in question does not belong to you or is in your possession under a contract of hiring or a loan
  • If you’re using the car in the course of your work
  • If you genuinely did not realise, nor have any reason to believe, that a valid insurance policy was not in effect

 

What is Fronting?

Seeing how a poor driving record might impact your driving insurance premium, some people with a flawed record might be tempted to avoid paying the higher premium that goes along with being classified as a “high-risk driver”. This practice is called “fronting”.

Fronting is when one attempts to get a cheaper rate on your car insurance by using the details of a different, and often better, driving profile. In essence, it is a form of insurance fraud, as you are lying to your insurance provider by providing them with fake information. 

If you attempt this strategy to avoid paying higher car insurance premiums, you could find your claims repudiated and your policies cancelled entirely, especially if you get in an accident. 

 

Conclusion

At the end of the day, while nobody enjoys paying for car insurance in Singapore, attempting to avoid it by breaking the law is likely to cost you much more than your premium would. 

There are ways, however, to ensure you’re not paying more than you need for your premium. If you’re interested in learning more about how to get the best bang for your buck when shopping for car insurance, consider reading these guides on how to choose a car insurance plan, and therefore, save the most money.

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