Motor Insurance In Singapore – How Are You Being Charged for Your Car Insurance?

Do you know that there is a system in which motor insurance in Singapore is being calculated? Many don’t know, and only a few bother to find out. It is important to know how you’re being charged for your motor insurance in Singapore.

In this article, you will learn the system in which motor insurers in Singapore use to charge you for your motor insurance, the factors affecting the price of your motor insurance, the importance of knowing how the system work and how can you use it to your advantage . Read on and find out!

Firstly, the system used to charge car owners is called the Risk Factor Premium Rating System. Under this system, points are awarded based on the different factors that might affect the price of motor insurance that is being charged. This leads us on to the next part, which is the Factors affecting the price of your motor insurance.

The factors affecting the price of your motor insurance can be divided into 2 categories. Firstly, factors contributed from the insured person and the vehicle and secondly, factors contributed from the insurer.

Factors contributed by insured person and car:
1. The type of motor insurance covers (Third Party, Comprehensive, etc.)
2. Market value of vehicle
3. Engine capacity and carrying capacity of vehicle
4. Model and age of vehicle
5. Nature of vehicle usage (Private, corporate, commercial, etc)
6. Age, sex and marital status of driver
7. Occupation and driving experience of driver
8. Claims history of driver

Factors contributed by insurer:
1. Insurer’s own risk profile
2. Insurer’s claims experience
3. Insurer’s industry own risk profile
4. Number of people making claims from insurer

Having understand the factors that affect the price of your motor insurance, you must now be wondering what’s so important about knowing it. Well, let me now share with you.

Knowing how you’re charged will not only give you a better understanding about the price you pay, but it will also help you get the best premium. With the knowledge at hand, you are able to compare quotes and also influence the factors that determine your motor insurance pricing.

On top of that, you can make use of the knowledge to your advantage. For example, you will realise that even though you have submitted identical information to different insurers, the premiums that you’re charged for your motor insurance is different.

This is so as the points that you are assigned given is done internally and each and every insurer will give different points due to the insurer’s own risk profile and claims experience.

Therefore, what you can do is to gather quotes from different insurers and make your choice. Because, even though their coverage may be the same, their motor insurance premium may differ. You may choose to register & insure the vehicle under another member of the family as a more experienced driver is required to pay less.

Now that you have read this article on the system that prices your motor insurance in Singapore, you can now go out there and look for the best price in town!