Car insurance is compulsory in Singapore under the Motor Vehicles (Third-Party Risks and Compensation) Act. Without a proper third-party-only plan or a comprehensive plan or even a third-party fire and theft plan, you'll find yourself in serious trouble with the law.

While that may be out of your control, finding cheap car insurance is very much within your power if you put in the time and effort to look and understand how insurers come up with quotes.
 
 
What are the factors that affect car insurance quotes?

Each bit of information for each factor is weighted differently with a risk factor. The higher the risk, the higher your car insurance quotation.
 
 
Car make and model

Different premiums are given based on your car's make and model.

Compared to European-branded cars, which have higher import taxes and pricier parts, Japanese or Korean cars typically have cheaper car insurance.

Insurers do also offer cheap car insurance for vehicles with smaller engines.
 
 
Age of car

For new cars, premiums tend to be higher compared to an older car because the repair cost is higher.

The cost of car insurance decreases with the age of your car. However, as your car ages past a certain point (usually 10 years or more), your premium will stop decreasing because there is a minimum that the cost of repairs can go. 
 
 
Age of insured

Young drivers are typically deemed to be more reckless and more likely to get into an accident.

On the other hand, elderly drivers are judged to be more accident-prone too as they have reduced reflexes and poorer eyesight.

Therefore, people below the age of 30 and over the age of 65 can expect to pay more expensive premiums.
 
 
Occupation

Insurers will use your occupation to gauge how often you'll use your car.

If you have an outdoor job, it means you will use your car more often, indicating a higher risk of accident, and this can translate to higher premiums.
 
 
Marital status

When you get married, insurers may lower your car insurance premiums because you have a family to look after now.

The risk of an accident drops, and so does your premium.

Don't give false information or you might have to pay for all damages in the event of an accident.
 
 
Driving experience (how many years of driving)

If you have less than four years of driving experience, you pay higher car insurance premiums. Within the first four years, the more driving experience you have, the lower your premiums become; but the reduction tapers off as you go along. For instance, a person with 10 years driving experience does not pay significantly less than one with only five years of experience.

Insurers base your driving experience on when you passed your driving test. The longer you've had your license equates to more experience. So get your licence as soon as you can even if you do not intend to drive immediately after passing!


Type of car usage

There are insurance policies for both private vehicles (non-commercial) and private-hire vehicles (commercial). Private-hire insurance premiums tend to be significantly higher due to the extended length of time you spend on the roads.

Fair warning. If you get caught driving a private-hire car with non-commercial insurance, your insurance policy will be terminated. 

Insurers like AIG, Etiqa and FWD offer more competitive insurance policies for commercial vehicles.
 
 
Driving accident claim history

If you have made accident claims against your insurance policy in the past three years, your insurer may slap you with a 'loading fee' that will substantially increase your insurance premium.

The loading fee typically applies if you have made a single claim of above $10,000, or did make two or more claims in the past three years.

If you have made three or more claims, most of the insurers will not insure you. Insurers rather not insure a 'high-risk driver' after all.

This brings us to our next point. NCD
 
 
No-claims discount (NCD)

You are entitled to a no claim discount (NCD) on your insurance premium if you've made no claims for a year and more. If you've stayed claim-free for a certain number of years, your renewal discount can go up to 50%! That's a significant amount of money! Find out more about NCD for car insurance.
 
 
Honesty and integrity

If insurers find out that you've been lying about your driving experience or other matters, they can quote you a higher price than before or even rescind the prior insurance policy. 

On another note, if you ever get into an accident, remember to be honest about what happened. Document the events with your phone camera and contact your insurer as soon as possible. Find out how you can make a smooth insurance claim in any accident.
 
 
Car modifications

We're busting one of the car insurance myths that insurers won't insure modified vehicles.

Insurers do insure drivers with modified vehicles, but the modifications must be LTA-compliant. Do note that insurers might differ when it comes to modifications. So make sure to check with your insurer before you modify anything.

If you do get into an accident, only original parts will be used for the repairs, not modified parts. If you would like to have these modified parts insured so you can make claims on them, you will need to take on an additional cover with your insurer and this will increase the premium price.
 
 
Compare insurance quotes online to get the best price

Now that you know what information insurers look at and how they access risk, you'll be able to compare quotes and get the cheap car insurance you need. Plus, you can easily acquire car insurance quotes online in the comfort of your own home!
 
 
Here are some car insurance-related articles that might interest you

Ultimate Guide to Car Insurance in Singapore

Don't get caught without proper car insurance coverage!

Got into an accident? Here's how to ensure a smooth insurance claim process

Common car insurance myths debunked! Know them and drive with a peace of mind

Five common car insurance claim mistakes to avoid