The Factors That Influence Your Motor Insurance Premiums

Why do motor insurance premiums differ from person to person? There are several factors that play a significant role in influencing the cost of your coverage.

Imagine this scenario, you have just gotten your license, or you may have just earned yourself a brand-new vehicle and are excited to start driving. The law in Singapore dictates that you must possess motor insurance on top of your car warranty to be on the road. However, you soon learn that your motor insurance premiums differ from your peers, which may leave you wondering why.

The following factors are considered by insurers when determining your motor insurance premium.

The profile of the driver

First and foremost, insurers would look at the profile of the driver. The driving experience and the driver’s age would come into play.

In Singapore, the premiums will be significantly lower for those aged 26 and above. Conversely, the premiums may be considerably higher and be increased when the driver is in their mid-60s or above.

The experience of the driver

The driver’s experience is calculated according to the date the driver passed their driving test. The caveat is that for those possessing a foreign driving licence, the date considered will be when it is converted to a valid Singaporean license. The typical scenario is that if you have had two or more years of experience on the road, your premium will be priced lower.

An example would be an individual who is 28-year-old and only recently received their driver’s license. The individual will be paying a higher premium than another 28-year-old who has had their license for more than two years.

Hence, while you do not intend to get a vehicle of your own at this current juncture, you would be better served to get your licence as early as possible.

The model and make of the vehicle

After considering the driver profile, one of the factors considered when it comes to motor insurance premiums is the make and model of the vehicle. Some models and brands have reasonable premium prices as they have a more significant concentration on the road.

The universal notion is that higher premiums are paid for supercharged performance vehicles. This means that owners of luxury vehicles such as coupes and cabriolets generally spend a higher premium annually.

History of claims

Your motor insurance premium may balloon due to this factor alone. The history and records of claims in Singapore stay with a driver for three years. You should be alert and drive attentively, as it results in non-claim, a sure-fire way to keep your premiums low.

The No-Claim Discount (NCD)

The NCD is a discount given to the insurers to help counterbalance the motor insurance premium. To put it plainly, the NCD is rewarded to insurers’ policyholders who maintain a good and spotless driving record.

To save yourself from burning a hole in your pocket, all you have to do is be mindful and safe while on the road.

Conclusion

There is no better option than engaging us at India International Insurance (III) when getting a comprehensive motor insurance policy. With over seven decades of experience in the industry, we can help you obtain the best policy available to you. Get in touch with us for a consultation today.