Calculation of Car Insurance Premiums
Car Insurance premiums are based generally on your personal profile and the car you drive, along with the risk you wish to take and the risks that are present, both for you and the insurer. Generally, many factors will be taken into consideration such as your car make and model, age, driving experience, claims history, occupation, and marital status, in deciding how much to charge you.
Risks are measured differently by various insurers, with varied factors taken into consideration as well. High premiums don’t necessarily depend on your skills as a driver, but more on the general statistics related to your personal profile and the vehicle you are using. It is also important to use this as your basis in comparing alternatives to your different choices until you can find the one most suitable for you.
The Concept of “Excess” and Its Impacts
As car insurance policies are customizable, the cost of your insurance premium can be lowered by increasing your “excess”. This refers to the amount of money you will shoulder before making a claim on your insurance company. Most insurers in Singapore offer quotes based on a $500 or $600 excess, which somehow is the average amount drivers are willing to pay for “excess”.
This greatly depends on how much you are willing to pay and generally, again, on the risks you are willing to take. It is important to remember, however, that increasing your excess entails a higher price on your premium.