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Full Guide to Car Insurance 2019
These are the most common questions we have been asked in Singapore regarding motor insurance coverage by motorists over the past 2 decades. Let us know if you have any more new questions! We keen active participants and will update if there are more news on electric car insurance, autonomous vehicles (soon…) etc!
Meanwhile, these are all the decades-old commonly asked questions!
We all know we have to get car insurance, but what if we forget to buy? (or worse still, knowingly ignored to buy)
What will happen if I drive without car insurance in Singapore?
In Singapore, it is compulsory to have car insurance to drive. You need at least Third-Party Risks and Compensation car Insurance in Singapore. (commonly known as Third Party insurance, the other 2 types are 3rd Party with Fire and Theft and Comprehensive Car Insurance)
What is the punishment for driving without motor insurance?
It is an offence that driving a motor vehicle in Singapore without insurance coverage can be fined up to $1,000, imprisonment for up to 3 months, or both. You will also be disqualified from holding or obtaining a driving license for 12 months from the date of your conviction.
What happens if you have a car accident without motor insurance?
Under the law, you have to pay for all repairs or replacing of the other party’s car if you are at fault in the accident, as well as all medical expenses, loss or damages to the other party. This can be a financial disaster.
You will also have to be responsible for your own car’s repairs, and damaged possessions, your personal medical expenses. In the event that your car still have outstanding car loans, merely giving up the damaged car and scrapping it will still give you some debts to pay off.
This is why the Singapore government has made it compulsory for motor insurance, to prevent motorists from financial ruining themselves in an accident.
What types of car insurance are there in Singapore?
- Third Party Risks Only
- Third Party Risks, Fire and Theft
- Comprehensive Motor Insurance
Third Party Only Car Insurance
This is the minimum car insurance scheme that you have to obtain in Singapore, and it is the cheapest because of its no-frills structure. Third Party Only covers
- Coverage for other people in an accident if it is your fault.
- Nothing at all for you.
That is it. Third Party essentially covers the bare minimum required by law, to cover any other party involved in a car accident caused by you.
What is Third Party car insurance suitable for?
Budget-conscious drivers with old cars.
If you have a fairly new car, I would recommend you not to consider this, as repair bills and replacement of a totally faulty car can be very expensive in Singapore. Even if this insurance covers your legal liability to the other party, you may face big repair bills for your own car. Even if you choose to scrap, you may face outstanding car loans for your own car that you have to repay.
Choose this scheme only if you have an old car, and only if you have to.
Third Party, Fire and Theft
It covers everything in Third Party, plus damage and losses from fire, theft, and vandalism. That is a lot better than the bare minimum of Third Party Only. You are getting coverage to your own car if you encountered fire, theft or vandalism.
Remember, “low crime doesn’t mean no crime.” (probably trademarked by Singapore Police Force)
What is Third Party with Fire and Theft car insurance suitable for?
This motor policy is still cheaper than the main type of policy, and will have some cost savings for motorists. Do take note that in an accident, it still does not cover your own car damage and losses, so you are still having the same financially exposed to the same risks as a Third Party Only policy.
The extra coverage is very worth it though, as there are still instances of cars burning in flames, car damaged or lost to theft or vandalism.
Comprehensive Car Coverage
Comprehensive motor insurance is the widest coverage and the most popular form of car insurance in Singapore.
As the name implies, you are covered for the other party, your own car, for all death, injuries, damages, and losses. You do not have to worry about medical costs, liabilities, etc that occurred from fire, theft, vandalism, car accidents to your own car or other parties.
Comprehensive coverage compulsory for most bank loans
Comprehensive Coverage is also required by most banks in approving the car loan, as the banks want to ensure that there is insurance coverage over your car.
As much as this popular coverage is sensible, if your car is more than 10 years old, insurers will not allow you to opt for this, you have to go for Third Party with Fire and Theft, as they deem your car too old and invaluable to cover.
What is comprehensive car insurance suitable for?
Most drivers who want to protect their expensive cars, which is basically every car in Singapore thanks to high taxes and COE prices.
Even when you are free to opt for other insurance packages if you have no bank loan, this is the popular and sensible package as you are protecting and reducing your financial risks.
What other benefits in comprehensive car insurance that I may like?
There are plenty of other benefits that insurers throw in, with no or little extra costs that are great for motorists. Some examples are:-
- extra 10% discount on the 50% NCD (may be popularly termed 60% NCD)
- 50% NCD Protection
- Windscreen protection at no NCD loss
- damage from riot, strikes and civil commotion
- damage arising from flood and windstorm
- liability of passengers for acts of negligence
- personal accident benefits for passengers
What are the difference between Any Workshop and Appointed Workshop motor insurance scheme?
Appointed Workshop Only insurance policies mean in the event of any repairs or assessment of damages, you have to send your car to one of the approved workshop in the insurer’s list of accredited workshop.
You cannot use any workshop as you like.
What if I claim on another party?
In theory, this would not matter whichever policy you are holding. So even if you are holding Approved Workshop only, you can go to any workshop, since the insurer paying out is on the other party.
However, do check with your insurer when an accident happened. This is because it has happened before in Singapore that an insurer deny payouts even on the third party and fight to reduce the payout. The insurer insists the rules apply to claims on another 3rd party insurance (Because the other party insurer is also them!). Sounds weird? Let me explain.
In a case that was published by Straits Times a few years ago, a car motorist was denied coverage and blacklisted by a certain local insurer. The motorist had a car accident and it was deemed the fault lies with the other party.
Hence the car motorist is claiming on the other party’s policy and not on his own (which is an Appointed Workshop only policy). He went to his favourite car workshop, which is not under the Appointed list because he believed he is claiming on the other party and does not come under his own policies.
Unfortunately, the insurance company was covering all the cars involved and under the terms, denied repair payout as it was not under “Appointed Workshops” list of the insurer. It made news and many motorists were appalled to learn that they should be cautious about making claims on repairs in other workshops, even in accidents that are not of their faults.
Any Workshops Insurance Policies
As the name suggests, car motorist can send their cars for repairs to any workshops. This is for reasonable and market priced repairs and assessment.
Insurance companies do make a point to investigate repair bills and assessment that may not make sense and are suspicious of fraud.
3 Ways to get Cheaper Car Insurance
If you are like most Singaporeans, you want the best deal for the buck. A car in Singapore is the most expensive priced in the world, do make a good deal for your motor coverage and save money.
- Visit a broker or an agent with more than 1 or 2 insurers.
- Increase your deductible (or Excess) that will reduce premiums
- Look for deals that tied with workshop, or other insurance package for overall discounts
Visit a broker or agent with many insurance companies
Comparison helps to reduce price, improve quality and most importantly, benefit consumers.
If your agent or broker has more than 1 insurance companies, he can helps to compare and get the best deal for you. The insurance companies know that this agency has volume of business and will reduce premiums or improve the benefits so that the agency will refer business to them.
Always choose an agent with more than 1 insurance companies
Increase your deductible or Excess
Increasing your deductible or excess in car insurance will help you pay lower premiums for your plans.
What is Excess in car insurance?
In car policies, the excess or deductible is the first amount you have to pay out of your pocket for any repairs and damages.
For example a policy may have $500 excess. This mean, in any accident, you have to pay the first $500 of the bill. Say your Honda has a repair bill of $8,000. You have to fork out the first $500, and the insurer will pay for the other $7,500.
You can choose a policy with higher excess. The higher the excess, the lower the premiums for the auto policy.
Choose a combination deals.
Talk to your insurance agency or broker for any tied deals. For example, you can choose to buy home fire, personal accident, and motor insurance together with him and he can work out a discount package for you.
Insurance brokers and agencies with a large variety of products to offer would love such deals with you.
Or you can choose a workshop tied up, where you get reduced premiums for your motor insurance in exchange for using a branded car workshop for your regular maintenance servicing and car repairs.
What is NCD or No Claims Discount?
Motor Insurance 50 NCD
NCD refers to No-Claims Discount and is offered to motorists that did not file claims in the previous year or years. If you have not filed a claim in 1 year, the NCD will start at 10% discount. This means you will get a 10% discount on your car insurance premium.
No Claims Discount is offered by all motor insurance companies in Singapore for all Singaporean drivers.
As the years go by, you will get higher and higher NCD. The official highest tier of NCD is 50% discount on your annual car insurance.
|Number of claim-free years
|Five or more years
Will I lose all my NCD if I make a claim?
No. Insurers understand that for drivers of big NCD, an accident in the years of claims-free years may be a blip in an otherwise good driving record. Hence, a 50% NCD driver will not lose all his NCD, he wil merely falls to 20% NCD.
Similarly, a 40% No Claims Discount driver will fall to 10% NCD instead of 0% NCD
||NCD after 1 claim
|30% and under
Can I lose my NCD if I sell or scrap my car?
If you sell or scrap your car, your no claims discount is still tied to you for as long as 24 months. The insurance company will offer the same NCD if you get a new car within 24 months. Do check with the insurer in advance as there are some companies that only offer the same NCD within 12 months.
What is NCD Protector?
You may choose to add a rider to your car policy that in the event of an accident, the rider will protect your existing NCD and you will not see a drop in the NCD.
This NCD Protector rider is only offered by a few insurance companies and to drivers with 50% NCD. Usually, the rider protects your 50% NCD with 1 claim per year. If there are 2 claims in a year, the NCD will drop to 20%. If there are more than 2, the NCD will be completely wiped out.
Is my NCD entitlement transferable to another person?
No, you cannot transfer NCD to another person, be it relative or close friends.
Why do I hear a 60% NCD?
Some insurers like to reward safe drivers with a long loyal bonus of sticking to the insurance with an additional 10%, making it 50% + 10%. This is actually a loyal bonus for safe driver sticking to the same insurer.
It is, however, a lot more catchy to be called 60% NCD.
What is windscreen protection?
Windscreen refers to the glass portion of the car, and is vulnerable to damage. Usually small incidents will cause windscreen damage or cracks and it is extremely painful to lose a high NCD because of windscreen claims.
Some insurance companies offer windscreen protection for an additional premium to allow for windscreen damage claim without affecting the NCD, subject to an excess.
What is named driver in car insurance plans and why is it important?
The named driver is someone who can drive the car with the owner’s permission and covered under the motor insurance. Besides the car’s owner, you can usually named another 1 or 2 people as the named drivers, and it is common for the driver to add in their spouse or family members as named drivers.
The named drivers enjoy the same benefits as the owner for the motor insurance. In any accident that occurred with a driver that is not listed in the policy, there will be a higher excess in claims.
Higher excess for unnamed drivers
For example, a policy of $500 excess will see the named drivers forking out an excess $500 in an accident.
However, an unnamed driver in the same accident may see a higher excess of $2000. Do check your insurance terms and conditions for the different coverage.
Less or No personal accident coverage for unnamed drivers
Some insurance policies have added benefits of personal accidental benefits for its named drivers. In some case, these extra personal accident benefits are not provided to unnamed drivers in any claims.
What do I do after a car accident?
Stay calm and check to make sure your passengers and you are safe and sound.
If there is any injuries, do seek medical attention first. You can get Emergency Hotlines in Singapore here.
You need to report to Traffic Police within 24 hours if these are involved
- Foreign Vehicles
- Damage to government properties
- Pedestrian or Cyclist
- Hit-and-run cases
- Injury cases where at least 1 person was taken to hospital or any party was injured with medical leave for 3 days and more
If you report to Traffic Police, do note that you still have to contact and file a report separately with your insurers within 24 hours or the next working day.
You do NOT have to report to traffic police after a car accident if the above are not met.
You should do these in in car accident
- exchange particulars of the parties involved in accident and take note of the vehicle numbers
- do take photographs of the scene of accident from different angles
- take photo of the damages to all vehicles (yours and the other parties)
- Do not admit fault or liability, leave it to the claims assessment department.
If you do want to file for a claim, you must report to the insurer within 24 hours or by the next working day. You may call your insurer hotline for calling a tow-truck or advice.
Do NOT do these after a car accident in Singapore
- If there is a fatal accident or someone is injured, do not move the injured person or vehicle till traffic police arrive.
- Do not move your vehicle before taking photographs and details.
- Do not allow your car to be towed by unauthorised tow trucks, especially those that showed up mysteriously shortly after an accident (Scam Alert)
What is IDAC for car accident reporting?
IDAC is “Independent Damages Assessment Centres”, a group of independent accident reporting centres that you can visit to make accident reports after an accident. You can visit IDAC for a one-stop accident reporting centre to help with any car claims.
Do I go IDAC after a car accident?
IDAC is a convenient stop. However, they are not linked with all car assurance companies in Singapore.
These car insurance companies are linked to IDAC
- India International Insurance
- NTUC Income
- Liberty Insurance
- UOI (United Overseas Insurance)
- Allied World Insurance
- First Capital Insurance Limited
- Tokio Marine Group (only available at Sin Ming Road and Jalan Boon Lay IDAC)
- Direct Asia Insurance (only available at Sin Ming Road and Jalan Boon Lay IDAC)
If your coverage is not under IDAC, you should go to either their authorised workshop to check for claims and repairs work or if you have Any Workshop coverage, you can visit your preferred car workshop.
You can visit the company website to fill in proper forms.
Do check with your general agent, the company hotline directly if you have other doubts.
Car insurer hotlines for Emergency & Accidents
We have compiled the latest hotline, updated as of 7th August 2019.
If you have commercial vehicles such as lorries, vans, company cars, you will be glad to meet the specialist for commercial fleet motor car insurance.
We have covered numerous car fleets in Singapore and is adept at finding the best price with great coverage for you.
If you just want to ask for your private personal vehicle, do check out private car motor insurance.