When it comes to car ownership, yes Singapore is definitely an expensive country. There are many costs involved in owning a car here. One of those contributory factors is car insurance premiums. Nonetheless, if we are smart about it, there are several ways which we can save some money on our auto insurance premium. Let’s take a look at it one by one.
1. Earn up to 50% No-Claim Discount (NCD) by maintaining a clean driving record
NCD is a discount given by insurers when you haven’t made any claims in a year. Considering the fact that you have been a safe driver, you will be entitled to a discount on your insurance premium. With an NCD, you can save up to 50% on your car insurance policy.
Suppose you have driven your car safely without making any insurance claims for an entire year. Then you will be given a 10% discount when you renew your policy the next year. If you don’t get yourself into an accident for more than five consecutive years, you get a 50% NCD. With safe driving, you can reduce half of your premium amount with ease.
The table below explains how much you can save on your insurance premium with the no claim discount:
|Discount you get during policy renewal||Driving period with no claims|
|10% discount||1 year|
|20% discount||2 years|
|30% discount||3 years|
|40% discount||4 years|
|50% discount||5 years|
2. Get a Certificate of Merit (COM) and reduce your car insurance premium
In Singapore, apart from your NCD, there is also something called the Certificate of Merit (COM). In addition to NCD, you will also qualify for COM if you don’t violate the traffic rules for three subsequent years. A Certificate of Merit will help you get a Safe Driver Discount of 5% on your insurance premium. Be a safe driver and qualify for both COM and NCD so that you can bring down your premium amount.
When you apply for a car insurance, your insurer will check your eligibility to get a COM. Hence it is important to maintain a clean driving record. With the help of EDDIES (Electronic Driver Data Information and Enquiry System), your eligibility will be verified.
Your takeaway here is to understand the importance of following traffic rules in Singapore. Driving safely is not only important for your safety but also plays a major role in you qualifying for discounts.
3. You will pay a heavy price if your driving record has demerit points
An insurer might end up charging you a higher premium when you have demerit points on your driving record. Your insurer’s confidence in your driving skills depends on your demerit points. So it is always better that you maintain a good driving record in Singapore.
In case you violate traffic rules during your probationary period, with just 13 demerit points your licence will be suspended for 12 weeks. If you have already completed your probationary period, it only takes 24 demerit points in a span of 24 months to have your licence suspended for 12 weeks.
Here are the demerit points you get when you violate traffic rules:
|Traffic Violations||Demerit Points You Get|
|Exceeding speed limit of 60km/hour for a specific road or vehicle||24|
|Usage of mobile phone while travelling||12|
|Skipping traffic lights||12|
4. Clean driving record is the key
Always remember to maintain a clean and good driving record in Singapore. Not just to qualify for discounts on your premium amount, but also to ensure your complete safety.
5. You need to know what type of car insurance is suitable for your specific needs
You need to understand that each car insurance policy comes with a varied range of coverage and different premiums. It is important to know what your car needs in order to make the right decision and avoid paying higher premiums.
Let’s take a look at the major kinds of car insurance plans you can opt for in Singapore:
Comprehensive Car Insurance Plans
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The word “comprehensive” says it all! If you are looking for broader coverage, this type of a car insurance policy is definitely apt for you. It provides coverage in the event of death or injuries caused to the other party, any kind of a damage caused to the other party’s vehicle because of theft, fire, or an accident, and also provides coverage for any kind of medical expenses that has resulted due to an accident.
Third Party, Fire and Theft Plans (TPFT)
When you opt for TPFT, you will not only get covered for your damages as well as the third party involved, you will be covered for theft, fire damage, and vandalism too. Especially, when you own an old car, this policy works well for you because your car would have already depreciated to a great extent.
Third Party Only Plans (TPO)
For someone who is keen on buying a pocket-friendly car insurance plan, TPO will surely make your life easy. It is the cheapest car insurance plan you can opt for. However, it only provides coverage for a third party’s death, or injury you have been responsible for. Expenses related to you and your vehicle will not be covered. Only expenses pertaining to the damage caused by you to the third party’s vehicle will be covered.
So, make sure you think carefully when picking the right car insurance plan, drive safe and follow the traffic rules to save money on your car insurance premiums.