I’m not sure about you, but car insurance is a thought that I still find a bit frustrating. Sure, I pay my monthly premiums, hope for the best, and get stressed out when I need to file a claim, but other than that, I basically keep everything related to insurance coverage in the back of my mind and hope only for the best.
I believe that motor insurance singapore policies, regardless of whether it is car insurance, home insurance, health insurance or term life insurance, should be issued with a complete guide to all the terms and phrases linked to the specific type for sure. That way, even the normal person on the street (which includes you and me!) Will have a better understanding of what our insurance plans entail and what we are actually paying for.
Let’s take a look at a couple of keyword phrases frequently used in the auto insurance industry:
Designated driver versus regular driver. When you buy an auto insurance policy, it is very likely that you (the policy holder) are the regular driver of the motor vehicle. This means that most of the time the vehicle is on the road, you will be the one behind the wheel. However, it is also possible to add a named driver to your policy. Let’s say, by way of example, that your spouse, child or someone else will drive the car from time to time, this needs to be reported to the insurance company and this person needs to be listed on your policy as a designated driver. If your vehicle is involved in an accident, and neither a designated driver nor the regular driver was driving, your insurance provider may deny your claim. Don’t forget that an insurance company will consider your full risk user profile before determining your monthly premiums, so if your designated driver does not have a good insurance record this will negatively impact your insurance profile and Consequently, your insurance premiums.
New for old insurance. In insurance terminology, this means that if an item is lost or destroyed, it will be replaced with a brand new item. Typically this is most relevant for home insurance, where you may need to replace a stolen TV. Unfortunately, car insurance works slightly differently. The value of your car or truck basically goes down as soon as you take your vehicle off the showroom floor. Therefore, if your motor vehicle is stolen when it is about a year old, the insurance organization will generally calculate what the current market value of your vehicle is and will only compensate you for that amount. If you want to insure your car at replacement value, you will end up with a nearly unaffordable monthly premium, as the risk to the insurance provider is simply too high.
