Guide to Buying Car Insurance
As a first-time car owner, or for someone who does not understand the insurance jargons it can be a daunting task and you might have paid for car insurance coverages that you might not need. Car insurance is a legal requirement of vehicle ownership in Singapore. However, with so many options available, selecting the right policy can be overwhelming. This guide will help you navigate through the process of buying car insurance in Singapore, helping you understand the various types of coverages, considerations to consider and tips on lowering your premium to keep it budget friendly.
Types of Car Insurance Coverage
Third Party Only (TPO): Covers damage to other parties’ property and death or injury to other parties. However, it does not cover damage to your own vehicle.
Third Party, Fire and Theft (TPFT): Includes TPO coverage plus fire damage and theft of your vehicle.
Comprehensive: Offers highest level of protection. Includes TPFT coverage and accidental damage to your vehicle as well as damage to your car’s windscreen.
Before we move on to the finer details of car insurance like the driver plans, usage types and optional benefits, let's do a quick dive into understanding the list of insurance jargons.
Now that we have understood the insurance jargon, let’s dive into the usage types, driver plans, optional benefits and useful tips when purchasing your vehicle insurance to suit your needs.
Driver Plans
In the list of insurance jargon, we briefly mentioned 2 types of driver plans:
Named Driver: covers people you have explicitly named, authorised to drive the car and will be covered. The number of named drivers allowed varies for different insurance companies. Including more named drivers can affect your premium.
Unnamed Driver: covers people who are not explicitly named in your insurance policy. Usually, insurance companies will impose an excess for young and inexperienced drivers [JG1] and/or with less than 2 years valid driving licence. Do check with your insurer what age they qualify drivers as young and inexperienced.
Usage Types
The different types of vehicle usages also affect your premium as well as the occupation of the insured.
| Usage Type | Description |
| Off-Peak | For Vehicles registered under the off-peak car scheme |
| Private Use | For personal and leisure use of your vehicle only |
| Private Use + Commuting to work | For Private Use and commuting to-and-from work use of your vehicle only |
| Private Use + Business | For Private Use of your vehicle for your business. This excludes carriage of persons or goods for hire or reward. |
Optional Benefits
Here are some of the common optional benefits available for your car insurance:
1. Any workshop: Some insurance policies limit the workshops you can send your car to for repairs. By opting for this, your insurer will pay for the repairs done to your car by any workshops in Singapore. However, if you are okay with your insurers list of approved workshops, then this optional benefit is not necessary.
2. 24 Hour Breakdown Assistance: This service provides roadside assistance when your car breaks down. This also includes burst tyres, towing services, battery jump starts and even an empty fuel tank.
3. No-Claim Discount (NCD) Protector: This optional benefit helps to preserve your NCD even when you have made a claim. Your NCD usually decreases after a claim has been made. But with the NCD Protector, you can retain your discount level and continue to enjoy lower premiums.
4. Accessories: This covers any loss or damage to your car modifications or accessories which are LTA compliant provided you have declared and was accepted by your insurer.
5. Medical Expenses: Covers you, your authorised driver(s) and passengers for medical expenses arising out of an accident while in your vehicle with a maximum amount per person.
6. Personal Accident: provides compensation in the event when you, your insured driver or passengers dies or are injured as a result of a car accident.
7. Repatriation Costs: Covers transportation cost of you and your passengers back to Singapore in the event when your vehicle is stolen or unrecoverable within the geographical limits set in your insurance policy. It also covers the cost of returning your vehicle back to Singapore if found.
8. Loss of Use: If your car is in the workshop due to an accident, your insurer will arrange a temporary replacement vehicle or compensate you for transportation costs.
9. Courtesy Car: your insurer will provide you with a courtesy car while your vehicle is being repaired.
10. Windscreen cover: This covers the cost of repairing or replacing your car’s damaged windscreen. This usually has an excess of $100 you have to pay out of pocket depending on the terms and conditions of your insurance policy set by your insurer.
Tips to reduce premium when purchasing insurance
Now that you know the coverage types available and optional benefits, here are some tips for you to help lower your insurance costs:
Having car insurance is essential in Singapore and it also provides financial protection and a peace of mind. Therefore, understanding the types of coverage and optional benefits is important as it gives you the power to make well informed decisions when purchasing one while staying within your budget. Do remember to regularly review your policy to ensure you have the best protection with the best value based on your needs.
