Factors deciding your car insurance premium

The premium of your car insurance is decided by commonly these factors mentioned below:
- The age of the insured
- What kind of plan (comprehensive, third party fire and theft or third party only)
- NCD (No Claim Discount)
- Insured’s occupation
- Insured’s driving experience
- Is the Insured driving
- Claim experience for the past 3 years
- Vehicle age, make, model and capacity (cc).

Another feature for car insurance in Singapore is the NCD protector. Basically the NCD protector gives the insured the “wild” card to the insured’s NCD when an accident happens. Meaning in the case if an accident happens the NCD remains the same while those without will revert from their current NCD back to zero. Normally the cost of having NCD protector will be around 10% to 20% depending on the insurance company. The insured NCD have to be at least 30% and the vehicle must be less than 3 years old in order for to opt for this feature.

Another factor which can affect the premium would be the excess for the policy. It is better to ask the financial advisor or broker regarding the pro and cons having an high excess. But generally rule of thumb is higher the excess lower the premium and vise verse. The downside would be the risk of paying more if an accident do occur within the policy year. In my opinion always ask yourself in case of an accident would I be able to pay the upfront? If the availability cash of that said excess amount is readily available then having an high excess might not be an bad idea.

The other factor which affect the premium and only available in Singapore would be the normal and off peak cars. But the difference between the both is minimal which is approximately 5% range.

All car insurance company have different sets of factors when deciding their premium most of which comes from previous claim experience. These claim experience provides a guide for the insurance company to revise their premium annually. Understanding these factors can help you understand and may also be able to save on your premium.

Will write more information based on the eight listed factors on coming post. Feel free to post any useful comments related to the topic above. Thank you.

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