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| Car Insurance Singapore |
One of the best ways to make significant savings on your vehicle insurance premiums is to build up a number of years of No Claims Discount for being claims free with the insurance company.
How does no claim discount reduce the price premium?
One of the factors that Singapore car insurance companies base on pricing their premiums is the level of risk associated with each specific driver, such that drivers who are deemed to be 'lower risk' will pay less for their car insurance than drivers who are assessed. To be 'higher risk'.
As far as insurance companies are concerned, the best barometer of risk is the number of years a driver has driven without making a claim on his auto insurance so a no claims' bonus is awarded for each year of claim free driving at 10% annually no claims up to a cap of 50%.
Because these discounts can be accumulated and calculated as a percentage of your premium, they can make a big difference to the cost of your auto insurance.
How is no claim discount calculated?
The way in which no claims discount is calculated often varies from insurance company to insurance company but, as a general rule, you can expect to get a 10 percent discount after one year of claim-free driving; 20 percent discount after two years; 30 percent after three years and up to 50 percent after five years.
No claims discount is provided for all types of policies so, even if you have third party coverage, you are still entitled to a no claims discount for each year you do not claim on your policy.
Note that for commercial vehicles the maximum discount without claims is 20%.
How to build your no-claim discount
The only way to get a no-claims discount is to not make any claims on your insurance. As explained above, the more years you go without making a claim, the bigger your discount will be.
Ways to lose your no-claim discount
The most obvious way to lose your no-claim discount is to make a claim on your insurance because you are at fault for an accident.
But it is important to note that your discount can be lost even if you are not at fault for an accident and the thing to remember is a no-claims discount and not a no-fault discount. So, for example, if you are hit by an uninsured driver, have to claim your policy and your insurance company is unable to recover the cost from the other party then this will count against you and can mean you lose all or part of your no claim. discount.
It is best to seek out your agent or insurance company for advice in the event of a claim so that your losses will be kept to a minimum and prevent the loss of the No Claims Discount you have accumulated over the years.
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