FIRST - How Is Your Car Insurance Premium Calculated?
Premium is derived based on a Points System that takes mainly the following factors into consideration:
-- Characteristics of Driver (Insured) --
a) Age of Driver. Here’s the age group that most companies use and how much it affects your premiums:
18 to 21 yrs old -- $$$$
22 to 25 yrs old -- $$$
26 to 30 yrs old -- $$
31 to 65 yrs old -- $
b) Gender & Marital Status. Generally cheaper for females as compared to males; cheaper for married compared to singles.
c) Driving Experience. Calculated from the time you got your driving license, not your actual driving experience:
0 to 1 yrs experience -- $$$$
1 to 2 yrs experience -- $$$
2 to 4 yrs experience -- $$
> 4 yrs experience -- $
d) Job Nature (Indoor/Outdoor). Self-Explanatory.
Indoor - $
Outdoor - $$
e) No Claims Discount (NCD) - aka No Claims Bonus (NCB). This is the premium discount you can enjoy if you have not made claims with your insurance company
You get 10% NCD each year if you don’t make any claims during your policy year. Your NCB can accumulate up to 50% max.
For example, if your auto insurance is $1,000 and your NCD is 20%, the actual premium you’ll have to pay is $800.
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. This is how your NCD is calculated:
f) Certificate of Merit Discount. A 5% discount is awarded to you (after deduction of NCD, if any) if you have NO traffic offense / demerit point(s) in the past 3 years.
To check if you’re eligible for Certificate of Merit Discount, Log On to eCitizen website (http://www.ecitizen.gov.sg) and select Transport -> Driving in Singapore -> E-Transaction -> Electronic Driver Data Information & Enquiry System.
-- Characteristics of Vehicle --
g) Engine Capacity (cc) & Engine Type. The lower the engine capacity, the lower your premium. Engine type refers to Normal or Turbo engine – obviously the turbo engine is going to be charged more.
h) Year of Manufacture. This generally means the year which your car is made/register.
i) Body Type. This refers to the type of car, eg. saloon, MPV, SUV, etc. Company usually charge more for unusual types of vehicle.
j) Off Peak Car (OPC). Generally, insurers tend to offer a slight discount for OPC.
SECOND - Finding a Cheaper Car Insurance
The price of car insurance premium change frequently - some people believe that it changes every 6-12 months. Therefore while Company X may offer the best deal this year, Company Y may be more competitive the next year.
This implies that you may have to compare different insurers’ quotes each time you renew your car insurance. You should get a good deal after comparing at least 6-7 companies. Of course, if you want the cheapest of all you’ll have to look for quotes from all the 20++ motor insurance companies in Singapore.
To compare several quotes, here’s one popular website you can explore using:
www.MotorInsuranceSingapore.com
Do take note that the quotes from different companies will come back with different excess amount.
For example, Company X may charge $2,000 with $600 excess while Company Y may charge $1,800 with $800 excess. This doesn’t mean that Company X is cheaper. It because the benefits offeredare different so they're priced differently. As to which is a better choice, this is a judgment call you have to make. (I’ll make a bet on Company Y ‘cos I very rarely get into any accident, at most very small ones)
Final Note:
Some of our motor insurance premiums have increased although we’re awarded with another 10% NCD & 5% Certificate of Merit Discount. This is almost certainly caused by the double increase in premium by all the motor insurance companies across the board in Singapore last year – yr 2008.
Ok, I think tt’s all for now. I’ll edit this post and include more info if anyone requests or feedbacks.
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