As we usher in the year of the rooster, it’s important for us to not only hope for the best but to be prepared for the worst as well.
So let’s touch (wood) on this topic of what you should do if you are a driver involved in a traffic accident. In 2015, injury related traffic accidents saw an increase of 2.7% from 7,809 in 2014 to 8,201 in 2015.
This increase shows that injuries from traffic related accidents is occuring at a rate of more than 22 injuries per day! This should be sufficient statistics for us to know that accidents on the road are common, and that we should not take our accident-free record for granted.
If you do get into an accident, you need to be mindful of the hidden costs involved, and how you can minimise it by maximising your insurance usage.
Take As Much Photographs As Possible
When you find yourself in such a predicament, the first thing that should cross your mind is to retain as much photographic evidence of the accident scene as possible. You should also swap contact (i.e. names, phone numbers, NRIC, home address) and insurance details) with the other party(s) involved.
If your vehicle was damaged in the accident and requires a tow truck to bring it to the workshop, you should call your insurance company to ensure that the tow truck company is approved by your insurance company, and that your vehicle is taken to to an authorised workshop.
The usual rate of hiring a tow truck is around $70, but this is a cost that could be higher.
Costs of minor repairs like bumper damages may range from an average of $150 to $300 or higher, depending on the brand of your vehicle.
For example, the removal of dents could cost anywhere from as low as $60 to as high as $500. Other more extensive repairs could include the replacement of headlights and tail lights. The service of spray painting your vehicle could range from $150 on specific areas to $2000 for the entire car body.
These figures are not definite because they are subjected to the model of your car and the extent of the damages incurred during the accident. Nevertheless, it puts into perspective how important having an insurance plan is in providing thorough coverage.
Naturally, you would expect your insurance company to assist you in the cost of the accident. However, you should also be aware of what your policies cover and what it doesn’t.
Your insurance contract may cover you from the towing of your vehicle to the repair of your vehicle and even your cab fares. Here are some important definitions that you might want to note when purchasing your car insurance policy.
No-claim Discount (NCD):
This is invoked when you have made no insurance claim under your policy for a year or more. If you don’t make any claims, then the NCD would reduce your insurance premium the following year.
The NCD acts like a signal for your insurer to indicate that you have been a cautious driver. The following table shows how insurers would ‘discount’ your premium annually. However, you should still clarify with your insurer on the exact rates.
Source: One Motoring
Some insurers even have the option of NCD protection which is the option of paying a fee to prevent the loss of the NCD. By paying a small fee to get the option of NCD protection, your NCD would still be in force even if you had to claim on your insurance once during the year.
To be eligible for this protection, you would normally have to accumulate 50% NCD. However, this may vary with your insurance policy. NTUC Income allows you to purchase NCD protection if your NCD is at least 30%.
Daily Transport Allowance:
This clause covers your transport costs from the day you send your car for repair up to a certain number of days.
This is the amount that you have to pay when you make a claim. For instance, if the damage of your car is $1,000 and your excess is $200, you would need to pay $200 first while the remaining cost of $800 is taken care of by your insurer.
Of course, your excess amount is inversely related to your insurance premium – the lower your excess, the higher your premium. Such excess can include, excess waiver, windshield excess and policy excess.
As with many insurance policies, there are always optional add ons to your policy. An example includes the option of going to a workshop of your choice. Add ons vary from insurer to insurer and you should check with your insurer whether these options are worth paying for.
Injuries sustained during an accident can vary from minor bruises to ones that require hospitalisation. In such cases, insurance policies would typically cover medical expenses incurred due to the accident and the payout is usually capped at a certain amount.
In order to claim on your medical expenses, you would have to arrange for it to be paid by your insurer by obtaining a letter from the hospital.
If the driver or passengers have sustained injuries during the accident, a police report should be made as soon as possible either from the hospital, or after you have been discharged.
The unfortunate event of being involved in an accident highlights the importance of purchasing an appropriate insurance policy. Simple mathematical calculations and logic would tell you that an accident would sap up funds from your bank account. An insurance helps prevent that from happening as it covers the necessary costs.
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