Having car insurance is always good, especially here in Singapore. When there’s an accident, you are sure that your car is secured under your car insurance and you don’t have to worry about paying everything out of your own pocket. But what if you get into a minor accident on the road? Like a small dent on your bumper from another friendly driver who took a slightly wrong turn? The damage is very small that it can be repaired for a few dollars.
Should you settle the matter privately or still give your car insurer a call? Would calling your car insurer to inform them about the incident hurt your insurance standing?
The right thing to do is always inform your car insurer about car accidents, even if you’re not planning on making a claim.
Why Should I Inform My Car Insurer?
One of the biggest reasons why you should inform your insurer of an accident, whether big or small, is for the protection of your interests.
If you don’t inform your insurer of the accident, they might mark you as untrustworthy and prejudice your claim in the event that the other party files a claim against you later. And if you’re the reason for the accident, you might have to deal with the third party’s exceedingly expensive repair work, or defrauding tactics on your own and without the help of your car insurance provider.
Also, the General Insurance Association of Singapore requires car insurance policyholders to report to their insurance providers any road incident within 24 hours even if they have no plan of making a claim. If the report was not submitted to insurance providers within 24 hours, the policyholder’s No Claim Discount (NCD) will be reduced by 10%.
When To Choose To Settle The Matter Privately?
While having insurance is good to cover your expenses in the event of vehicle damage or bodily injuries to third party, there are some advantages in settling minor damages on your own and saving your car insurance claims for bigger, more problematic accidents in the future.
Here are some situations when you could choose to settle the incident on your own and not make a claim from your car insurance provider:
The Damage Doesn’t Exceed Your Excess
Even when you have insurance, a portion of the repair will still come out of your pocket before your insurance provider will shoulder the rest. This payout from your pocket is called “excess” under a Comprehensive plan and you’ll have to pay this first before your insurance policy will take care of the rest.
When repair for the damages won’t exceed the excess you have to pay for, it would be best to just settle the matter privately since taking out a claim on your insurance may affect your NCD and your renewal premium.
When You Have Made Earlier Claims Already
When you have already made a lot of claims on your current car insurance policy, you might want to avoid making a claim for minor damage that you can pay from your own pocket.
Taking in too many claims on your insurance will make it hard for you to renew or get new insurance coverage from an insurance provider.
This is because insurance providers do background checks on your claims history to see if you are a risky person to insure or not. If you have a lot of claims, insurers will have second-thoughts about insuring you. They may decline your application or adjust the premium or excess higher to protect themselves from the risk of another claim.
Get Insured now
When you have a car insurance policy, you have the responsibility of informing your insurance provider of any incident or life-changing events you go through. Not only because they are there to cover you when something goes wrong, but to also to make sure that your insurance coverage is still fitting for your lifestyle.
So no matter how big or small an incident you get into and whether you will make a claim or not, always involve your insurance provider so they are aware.
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