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Car insurance payment. Smart ways to save + avoid hidden costs
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Last Updated: 9 March 2023
Last Updated: 9 March 2023
A good financial plan is like a road map - the choices we make today affect what’s ahead. So if you buy car insurance direct, you are already making a smart choice. In Singapore, it’s the cheaper, better option.
Car insurance payments – read the small print!
When paying for your car insurance most companies will generally give you a choice - pay the lump sum total or pay in monthly installments. On the face of it, monthly payments seem like a good idea. You get to keep the cash in your bank for as long as possible and you’re not left with a hole in your bank balance after forking out a lump sum. BUT it pays to read the small print:
- Some insurance companies can add quite a hefty amount to the premium if you pay monthly, typically anything around 10 percent extra. Suddenly, the good deal you’ve been quoted on your car insurance premium becomes less appealing.
- Do the math. Some insurance companies may not be overly transparent about their additional fee for monthly installments. Without checking, you may just overlook any extra charges.
A smarter choice
If you’re struggling to make the lump sum payment then look for insurance companies that offer 0% interest installment plans.
- Budget Direct Insurance Singapore offers zero percent interest on its 12 monthly installment payment plan.
- This means there is no difference between paying for the single lump sum premium and paying in 12-month installments. Bonus!
- Instead Budget Direct will incentivize its customers to pay upfront by rewarding them with a 3% discount. So no nasty surprises about your premium going up but you do get a discount if you pay in full. Double bonus!!
A spokesperson for Budget Direct, said:
“Offering Installment Payment Plans (IPP) is a way to cater to our customers’ needs. If the customer has the capacity to pay premiums in full, they get to enjoy a 3% discount. If customers prefer the installment plan because they don’t want to outlay a lump sum, or if they would prefer to invest their cash elsewhere, the IPP gives them more flexibility and control.”
Or, you could do this…
Another way to finance your lump sum payment - if your insurer doesn’t offer an IPP - is to take out an interest free loan with your bank. Again do check the small print to make sure that there are no hidden charges.
The best option
Our advice, though, is to shop around for insurance companies that offer IPPs with zero percent interest. That way you’ll know exactly what you’re paying for. Budget Direct Insurance – A smart choice now, and for the road ahead.
