Motor premium does not depend on value of car

ISSUE:

A motor policyholder asked why his renewal premium was not reduced according to the depreciation in value of his car. He cited that other insurance companies also practice the same thing.

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MY REPLY:

You have taken the right approach, which is to find out the most competitive premium rates from a few insurers.

Each insurer will have to decide on what is its appropriate premium rate, taking the relevant factors into account. I hope that you find our premium rate to be competitive and our service to be satisfactory, and will renew with us.

We are not able to reduce the premium rate based on your argument. Please allow us to practice what is practical for us.

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POLICYHOLDER'S REPLY:

Dear Mr Tan,

Probably you're the only CEO of a prominent organisation who always pay attention to small issues. And easily accessible by common people like me. I appreciate that.

From your email, I have a perception that once a premium reach its lower threshold, then other factors outside the insured parameters (such as; insurer's operational and indemnity cost) will play a significant role.

Frankly speaking, I still found that NTUC Income i! s still the most competitive among those big players in motor insuranc e.

I did have good experience with Income in the past, no doubt about it.