Disadvantages of Car Loan-Insurance Bundles
In Singapore, it is common practice for car dealerships and salespeople to bundle up their loans with car insurance in the Open Market Value or OMV of the vehicle. As convenient as a single deal may seem, there are a lot of potential downsides when you choose bundled car insurance. In this blog post, we list down some of the disadvantages of choosing this type of arrangement.
You don’t get to choose your car insurance company in Singapore.
One of the major disadvantages of getting car insurance bundled with your car loan is that you won’t have control over who your motor insurance company will be. There are so many different car insurance companies in Singapore and all of them offer different plans that might not be what is best for you. Plus, insurance companies also differ when it comes to their claims procedures. Difficult insurance claims procedures will certainly make it very difficult for you in the long run. This can be a terrible disadvantage if you want to have an informed decision when it comes to choosing your car insurance. After all, signing up for auto insurance is a long term commitment and you never know when you have to file a claim.
Your car insurance will come with additional expenses.
Car dealerships often market their packaged car loan and insurance deals by saying that it is much more affordable by getting your car insurance individually. But what they don’t tell you is that you may be paying for additional expenses. The reason why bundled car loan deals have additional expenses is because car dealerships and salesmen often get commission every time they make a sale. This is definitely a drawback for those who want to save as much money as they can when it comes to their car budget.
You are stuck with your motor insurance plan.
Because packaged car loan and auto insurance deals are often inflexible when it comes to the different plans you can choose from, you will likely be stuck with a plan that doesn’t really work for you. You will miss out on having a flexible car insurance plan. Customisable vehicle insurance plans allow you to pick and choose from different types of coverage that will fit your lifestyle. Another advantage that flexible auto insurance will provide you is control over your insurance policy. Bundled car loan and vehicle insurance deals will definitely limit your ability to choose the right auto insurance coverage.
Despite attractive packaged car loan and insurance deals, you should consider other options before settling on a bundled car loan deal. Auto insurance is definitely something that you have to choose carefully as this can have consequences later on if the time comes where you have to make a claim. There are also a lot of upsides with choosing a direct car insurer such as better discounts and more customised motor insurance plans that are better suited and more affordable for you.
Invest 5 Minutes for Instant Rewards
Learn more about how choosing direct gives you a better auto insurance deal. Choose the plan you want. Pay the way you want. You are insured!