If you are an avid reader of our articles, you would know how little it costs to rent a car through a car-sharing company such as Tribecar. However, if you are a car-sharing user that has taken a closer look through the pages of terms and conditions, you would have likely stumbled upon the hefty insurance excess figures and gotten a big shock…
What is insurance excess, and why is it such a hefty amount?
Motor Insurance is compulsory in Singapore, and it is so for a good reason. Being expensive machines that can also cause substantial damage to others’ properties, an insurance policy will ensure affected parties are compensated in the event of an accident.
Insurance excess is the amount that you need to pay in the event of a claim – for example, if the excess is $1,000, and the repair costs comes up to $3,000, you would be required to pay the $1,000 excess and claim for the remaining $2,000. What excess does, is to reduce the amount of small claims (in such a case, any repair that cost less than $1,000, you won’t be making a claim), as well as passing some responsibility to the driver.
Typically, insurance premiums and excess are inversely related – a plan with lower premium tend to have a higher excess. Another reason for higher excess is the level of risk – young and inexperienced drivers will tend to have a higher insurance excess. And these are contributing reasons to why hefty excess amounts are often applied to rental and car sharing services. With the perceived risk, insurance companies tend to require a higher amount of excess for such usage.
Repairing an accident damaged car is a costly affair!
You might be thinking that as long as you don’t get into some severe accident, the repair bill won’t be more than a couple hundred of dollars, but that couldn’t be further from the truth!
Go ahead and do a quick search on any of the local online marketplace, and you’ll quickly see that a pair of original replacement head lights for a popular model such as the Honda Vezel can easily cost more than a thousand dollars!
Add in the cost for some panel works and a partial spray job and you’ll see that a minor fender bender can make a huge dent in your savings, oh and we haven’t even accounted for compensations to the other party.
When it comes to compensation to the other party, you have to consider not just the hefty repair bills, but also the loss of usage, replacement rental car fees and others. Now, with all these claims, you almost certainly have to bear the full brunt of the excess!
That’s why you shouldn’t simply ignore the section regarding insurance excess when you are choosing a car rental or car-sharing operator to use. In fact, I would make the effort to seek out an option for a lower excess, just to play it safe.
Does the insurance excess differ greatly between different companies?
The insurance excess for car-sharing and car rental services is often rather high due to the nature of such services – the cars are driven by all sorts of drivers which can mean a higher risk for the insurance company to undertake.
In fact, the excess of some companies can even reach five-figure in the worst case scenario (sum of both own and third party excess). While the excess differs from each car rental or car sharing company, most are on the high side. If you choose the wrong platform to rent from, you can potentially clear out your savings from if you were to meet with an accident.
|Car Sharing Provider||Shariot||BlueSG||GetGo||WhizzCar||Tribecar|
|Typical 3rd party excess||$2,675||$5,000||$3,210||$3,000||$3,000|
|Total excess after CDW||$2,675||–||$3,210||–||$3,000|
|After Tribeshield excess rider claim||–||–||–||–||$1,000|
As can be seen from the table, among these five popular car-sharing providers in Singapore, Tribecar, with its Tribeshield excess rider allows you to pay the lowest excess at just $1,000, which is less than half of the provider with the next lowest excess.
So, how does Tribecar’s Tribeshield work?
Tribeshield is Tribecar’s proprietary motor insurance excess rider, an optional add-on that costs only $1.20 per hour (capped at $10).
In the event of an accident, you will still have to pay the excess, however, you can then make a claim using Tribeshield, upon which the effective excess that you would have paid would only be $1,000 ($500 per section of own and 3rd party excess).
You should not confuse Tribeshield with CDW (Collision Damage Waiver) which reduces your insurance excess by a percentage, usually 50%. Unlike CDW which is offered by various car-sharing providers, Tribeshield is a unique initiative by Tribecar that no other car-sharing platform offers. However, when using a Tribecar, you can opt in for both CDW and Tribeshield – lowering the initial excess payment before you proceed with the Tribeshield claim process.
Tribeshield also covers new and less experienced drivers who are liable for higher insurance excess due to the higher risks involved.
Accidents on the roads aren’t always avoidable, and without proper protection from costly insurance excess, a low-cost drive can easily become a costly affair should you get into one.
Hence, opting for Tribeshield with Tribecar will be the safest option to protect you from unexpected financial stress.
Sign up with Tribecar and enjoy 30% OFF your first booking (capped at $10) with SGCM’s exclusive promo code – TCSGCM.