Car Insurance
From Financial Literacy Wiki
In Singapore, purchase of car insurance is compulsory and there are three main types of car insurance. They are:
Third Party Only
This plan covers the insured person if third parties such as passengers are killed or injured or damage to the the third parties' property.
Third Party, Fire, Theft
This plan is an extension of the above. As the names says, it covers the insured person's vehicles against loss or damage resulting directly from fire or theft.
Comprehensive
This plan provides the widest coverage. Besides providing the same coverage as the two plans mentioned above, it also covers damage to the insured's vehicle as well as to other vehicles that the insured person uses with the permission of the owners. Some plans will also provide personal accident and medical expenses cover to the insured. There is another option for such plan and that is to extend the coverage to authorised drivers and passengers in the vehicle.
Factors to Consider When Purchasing Car Insurance
Premiums
Premiums are charged according to the attributes of the vehicles and driver, and where possible, the claim history of the insured person.
Amount of Deductible
Find out the deductible you might be required to bear before the insurance company steps in to cover the rest of the costs. Generally the deductible will be higher for young and inexperienced driver. This deductible can range from a few hundreds to a few thousands dollars.
Courtesy Car
Some insurers provide a courtesy car when the damaged insured vehicle is under repair ranging from 10 to 14 days.
Personal Accident Cover
Some plans does offer personal accident coverage on insured person and/or passengers. So do take note of the insured amount for both parties. Owners of family cars should take greater consideration in this aspect of insurance.
No Claim Amount(NCD)
This is an option is available on renewal to those who did not make a claim for a year. NCD reduces the premiums for the following year.And it is possible to reduce your premium to as low as 50% of your premium. And you can also purchase an insurance for NCD, which is advisable if you have maintained a good record with the insurance company for a long time.
Repair Options
Check for restrictions on who can repair your car and whether it will be repaired with new parts. Most insurers allow their customers to have their cars repaired at their preferred workshops. A customer can enjoy lower premiums if they bring their damaged vehicles to insurance companies designated workshops.
Windscreen Damage
Most insurers provide free windscreen replacement but apply an excess of $100 for each claim. But one have to take note whether windscreen damage would affect your NCD.
Towing and Roadside Assistance
How many times have we seen cars parked at the side due to car problems, during peak hours? Look out for the availability of this option if this is a situation you do not want to be caught in for too long. And take note whether such option is provided for a fee or for free.
New-for-Old Replacement
If a damaged car is written off in an accident, some insurance companies may pay the full purchase price to buy a brand new car of the same make and model if the car is within a certain age.
