In any part of the world, car insurance is essential. You need this to get protected against damages and accidents, given how much a car costs today.
Indeed, there are various things to consider when it comes to buying car insurance. This article will help you make an informed choice today.
Top Reasons for Having a Car Insurance
Car insurance is necessary to cover the injury or death of someone who is affected by the car accident. If you do not have insurance at HL Assurance Singapore, you can be fined or face jail time. Furthermore, you can be disqualified from obtaining or holding a driver’s license for 12 months from the date of your conviction.
Apart from legal penalties, getting into an accident while driving without insurance can lead to financial ruin. During accidents, you will be forced to pay for car repairs. Moreover, if you injure someone, then you can be sued for damages, losses, and expensive medical expenses.The amounts sued for during serious injury or even death can run into hundreds of thousands of dollars, sometimes, even millions. But if you have an insurance policy, this cost will be borne by the insurance company. Thus, having an adequate car insurance policy at HL Assurance Singapore is all about protecting yourself.
Terms to Take Note in Car Insurance Policies
Excess
In looking for the best car insurance online, you will discover that excess refers to the amount of money that you have to pay out of your pocket for damaging your car or others. This is the amount that you have to pay before the insurance company will cover the rest.
For example, your excess payment is $500 and you hit your car which incurs a repair cost of $2,000. Now, you have to pay first the $500 for the repairs. Thereafter, your insurance company will pay for the remaining $1,500.
You can have a low premium if you pay higher on the excess of the insurance policy. It may seem like a good idea to buy an insurance policy with a high excess so you can lower down your premium. However, if you meet an accident, you will have to pay the high excess out of your pocket and this can sometimes be painful for you.
If you are not a great driver, you can consider buying a policy with low excess so you can save some money during an accident. But if you are a confident and skilled driver and you believe that the chances of meeting an accident are low, then you can consider getting a policy with a low premium and high excess. See to it that you can afford that you choose should you get in an accident soon.
However, there is an exception to this. If the insurance company sees you as a risky driver, they might make you have a high excess without the low premium.
Main Driver/ Named Driver
The main driver refers to the policyholder and the person who drives the car frequently at car insurance online. Some companies allow up to five people to be added to the policy without any charge. But young and inexperienced drivers will have to pay a higher excess.
No Claims Discount
No claims discount is also known as no claims bonus. This is the company’s way of rewarding or recognizing your efforts for being a careful driver. This is for the number of years in which you haven’t claimed on your car insurance policy. This enables you to reduce the premium that you have to pay for the next year. Insurers pay a 10% discount for each year that they don’t make any claims at all. This leads to a 50% limit for five years or longer. Sometimes, some companies offer up to 60% discount after 10 consecutive years of no claims at all.
On the other hand, if you make more than one claim in one year, your NCD will be reduced to 0%. Because of this, many people prefer to pay for the cost of a smaller accident themselves if the amount is less than what they would lose in their NCD.
There are insurance companies that offer an NCD protector on their insurance policies. This means that you have to pay for an additional fee to keep your discount intact even after making a claim. But this is only good for one claim only, thus, you must be careful on the road. Usually, the NCD is tagged to your name and not on your vehicle. Thus, even if you change your car, you can still maintain your NCD.
Premium
This refers to the amount that you have to pay for your insurance policy. You can have the option to pay for one year’s premium upfront. Or you can pay the monthly installment with the use of your credit card, depending on the terms of the insurance company.
