A Quick Guide to Car Insurance for Used Cars
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Owning a car in Singapore is almost a luxury, considering the exorbitant prices of cars and the high cost of maintenance. The depreciation of a new car is another deterrent that may keep you from investing in a new car. In case you need to invest in a car due to certain compelling reasons, it may make better financial sense for you to invest in a used car. Used cars are usually much more economical, have lower depreciation and the overheads may not pinch you so much. You can also make use of loans from financial institutions to buy a used car of your choice. The used car market in Singapore is very competitive and you may be able to negotiate your way into a fantastic deal.
When you buy a car in Singapore, you need to give due consideration to car insurance as well. The car insurance market in Singapore has a multitude of insurers, offering a wide spectrum of products to the customer. Car insurance in Singapore is an expensive proposition but one that you cannot do without. You can opt for an insurance policy for your used car to protect you from the financial loss that may arise due to any unfortunate event such as an accident, any unpredictable dangers or adversities or risks that may lead to serious losses/damages to the car and the liabilities arising out of it. .
Factors to be borne in mind while purchasing car insurance on a used car
Type of Policy
Third-party insurance cover is mandated by the Singapore government. A TPO (Third Party Only) policy will protect you from the financial liability arising out of any bodily injury or financial loss to a thirty party. A TPFT (Third Party Fire and Theft) will offer third party cover and protect you from losses that may arise due to fire and theft. A financially prudent buyer will opt for a comprehensive cover that gives you total protection. In such a policy, the policy extends beyond third party liability, fire and theft. Any loss or damage caused to you, injury to your passengers and damage to your car will be protected under such a policy. A comprehensive policy is recommended if the value of your used car is high or you have a large outstanding car loan on the used car. In Singapore it is mandatory and driving a motor vehicle without a valid insurance policy covering third party bodily injury is against the law.
The amount of coverage can be chosen based on the value of your used car. If your used car has a Certificate of Entitlement COE (more than 10 years old), it is advisable to opt for a lower coverage and save on the premium outflow.
Policy Excess or Deductible
At the time of making a claim, there is a certain percentage of the claim amount that must be borne by the policyholder. This amount is known as the deductible or excess. You need to compare the deductibles under various used car policies before you make your choice. Know more about car insurance excess here.
No Claim Discount and Premium Rebate
If you are a cautious driver and do not make any claim for a certain number of years, the insurer may offer you a discount on the premium amount. This is called a No-Claim discount or premium rebate. This is another factor that you need to analyze while choosing appropriate car insurance for your used car.
Coverage across the causeway
If you are a person who travels to Malaysia for work, you may need to check whether your car insurance policy covers you across the causeway all the way to Malaysia. You may need to top up your policy to offer coverage across the causeway. Keep your travel needs in mind while buying car insurance on your used car.
When you buy a used car, please remember to check for any pending violations, court cases or other liabilities. Make sure that the car is in top shape and you do not end up paying a hefty sum on maintenance.
To sum up, you need to be cautious when you buy a used car. It is important to have clarity on your requirements while negotiating for appropriate car insurance for your car. If you need guidance on choosing the best plan for your used car, talk to the insurance expert at DirectAsia Insurance at 66655555. With the customer satisfaction rating of more than 90%, we are one of the top car insurance providers in Singapore. Get in touch with us today!