Factors That Affect Your Car Insurance Premium
Trying to understand the way your Singapore car insurance premium is priced can be quite confusing. Many drivers have questioned about their car insurance premiums and yet have little understanding on how it all works.
Not to worry as this article gives you an idea on how insurance companies in Singapore price their car insurance premiums.
Car insurance premium in Singapore is based on a point system that follows 2 categories of factors. Firstly, the Characteristics of the Driver insured, and secondly, the Characteristics of the Vehicle.
Now here are the contributing factors that affect your car insurance premium:
Category #1: Characteristics of Driver (Insured)
- Age of Driver
- The older you are, the less your premium costs.
- Major factor that affects the price of your Car Insurance Premium.
- 18 to 21 yrs old — Most Expensive
- 22 to 25 yrs old — Expensive
- 26 to 30 yrs old — Moderate
- 31 to 65 yrs old — Least Expensive
- Gender & Marital Status
- Cheaper for Females than Males
- Cheaper for a Married person as compared to a single
- Driving Experience
- The more Experienced you are, the less your premium costs.
(Calculated from the time you got your driving license)
- 0 to 1 yrs experience — Most Expensive
- 1 to 2 yrs experience — Expensive
- 2 to 4 yrs experience — Moderate
- > 4 yrs experience — Least Expensive
- Job Nature (Indoor/Outdoor)
- Cost more if job nature is Outdoor, and less if Indoor
- No Claims Discount (NCD)
- If you have not made any claims with your insurance company for a year, you will receive a 10% NCD to reduce your Car Insurance Premium the following year.
- You will receive an additional 10% NCD every year and your NCD can be accumulated up to a maximum of 50%.
- If a claim is made during a policy year while you are still enjoying NCD, the NCD will be reduced the next time you renew your motor insurance.
- Certificate of Merit Discount
- If you have NO traffic offense or accumulated demerit point(s) in the past 3 years, a 5% discount is awarded to you on top of the deduction of your NCD.
Category #2: Characteristics of Vehicle
- Body Type
- Types of cars – Sedan, MPV, SUV, Sports Car, Station Wagon, etc.
- Costs more to insure unusual types of vehicle.
- Engine Capacity (cc)
- The higher the engine capacity, the more your premium costs.
- Engine type
- Types of Engines – Normal or Turbo engine
- Costs more to insure a car with turbo engine
- Year of Manufacture
- Year in which your car was made/registered
- The older the car, the less you pay.
- Some insurers refuse to offer comprehensive coverage for cars beyond 7 years old
- Vehicle Scheme (Normal/Off-peak)
- Some insurers offer a 15% discount for Off-peak cars
With the large number of contributing factors to price a car insurance premium, inconsistencies are never far away. Nonetheless this presents us a chance to get the cheapest prices for your car insurance.
An easy yet effective way to save on your Singapore car insurance is to compare quotes from at least 8 to 10 different insurers. This will be sufficient to surface the insurance company that is in favour of your vehicle or driver profile.