When you spend more than 8 hours a day on Singapore’s busy roads ferrying passengers around, having ample car insurance coverage is essential.
Compared to regular drivers, you run a higher risk of getting into an accident and raking up high repair costs; your car parts also undergo more wear and tear, requiring more repair and replacements.
And should your car break down, your income stream is effectively gone while it is undergoing extensive repair works.
Commercial car insurance from private hire companies
Ride-hailing platforms do offer some insurance coverage to protect their drivers and passengers. For example, Grab offers free group Personal Accident Insurance (PAI) coverage for GrabCar and GrabBike passengers and drivers across the region.
This group PAI policy offers coverage in the event of accidental death, permanent dismemberment and bodily injuries in the event of accidents for drivers and passengers. The total personal accident benefits for the driver or passenger is up to US$250,000 (S$343,122) per vehicle, or up to an aggregate limit of US$2.5 million per accident in Singapore.
However, PAI does not protect you against a list of other unfortunate events that could occur while you are on the job.
For example, if your car is damaged in an accident, you will not be able to claim for its repairs or replacement from Grab’s PAI. You will also not be able to claim for third party damages or legal liabilities to or of passengers. This could leave you with expensive bills to pay out of pocket.
So, let's see which other policies on the market can help insure commercial private hire drivers.
How to select a car insurance plan for private hire cars?
That’s where commercial car insurance plans come in. There are three main types to choose from — Third Party Only (TPO), Third Party Fire and Theft (TPFT), and Comprehensive.
In a nutshell, TPO is the most basic and cheapest type of car insurance you can get that meets the minimum legal requirements for driving under Singapore law. It only covers your liabilities for damage or injury/death caused to others and their property — that is, if you hit and injure a pedestrian or knock down a gantry while using the car. Any damage to your own car is your responsibility.
The Third Party Fire & Theft (TPFT) is largely the same as the TPO, but includes some extra coverage, such as payouts in the very specific instances of fire or theft.
Comprehensive covers your third party liabilities, plus any damage to your car.
Depending on the plan you choose, there could also be additional features such as personal accident coverage for the driver (up to a certain amount), repairs at a workshop of your choice, windscreen replacement coverage, cover for liability to your passengers, 24-hour roadside assistance for breakdowns (towing and battery jumpstarts), and much more.
A TPO or TPFT may seem like a more attractive choice given the lower premiums. But taking into consideration the amount of time you spend on the road and your dependency on your vehicle for your livelihood, a comprehensive insurance plan could offer you more peace of mind and protection in the event of a mishap.
Some general points to note about commercial car insurance plans:
Premiums are usually higher than most private car insurance plans as driving for private-hire activities is deemed to be higher risk. Insurers that offer such policies have also seen a higher number of claims, hence pushing premiums up.
Just like for private car insurance, you will most likely have to fork out an excess during an accident. The excess usually varies according to your car make and model. Also, be prepared to pay a higher excess for commercial car insurance than for most private car insurance, because of the higher risk involved with private-hire activities.
If you are sharing your vehicle with other private hire drivers, note that only the policyholder under which your vehicle is registered will be covered. Depending on the policy, you may be able to add named drivers but the premium will most likely go up.
Top commercial car insurance plans for Grab drivers
Many insurers provide commercial car insurance plans, however, the one recommended by Grab on their website for private-hire drivers is FWD.
FWD claims to be the only insurer that offers private-hire drivers like Grab drivers the option of buying car insurance online. Its plan is tailored to the needs of private-hire drivers, with key benefits such as:
Customisation of excess to decide how much you want to pay for damages or loss of your car to limit your repair costs
Lifetime 50% NCD lifetime guarantee
Disbursement of daily income when your car is under repair
Repair guarantees until your car turns 10 if the repair is done at FWD premium workshops
Vehicle repairs, medical expenses, third-party damages and roadside assistance
Choosing a lower standard excess increases the premium you have to pay.
A number of other insurers also offer commercial car insurance. In addition, many offer add-ons which could allow you to repair your car at a workshop of your choice, coverage for other car accessories, protection against floods and windstorms, and more. Here are some of the major insurers, as well as their policy highlights (non-exhaustive):
||Commercial Car Insurance Policy Highlights
- Accident repairs at the workshop of your choice
- Windscreen replacement cover
- Cover for liability to third parties and your passengers
- Cover for loss or damage
- Caused by an intentional act by a party during a strike, riot or lockout
- Protection for vehicle lock and keys
- Covers loss or damage to your vehicle due to accidental collision
- Windscreen coverage
- Injury to you or your passengers
- Your legal liability to third party’s (including your passenger’s) injury and property damage.
- Add-ons: additional accessories, any workshop extension, brand new vehicle replacement
- Vehicle, spare parts and accessories
- Accidental loss or damage by fire
- Loss or damage by theft
- Accidental loss or damage by other insured causes
- Accidental loss or damage to windscreen
- Legal liabilities for death or bodily injury to third-party, loss or damage to third-party property, your legal costs and expenses
- Accidental damage to your vehicle
- Damage arising from riot, strike and civil commotion
- Damage to other parties' property
- Death or injury to other parties
- Fire damage to, or theft of, your vehicle
- Windscreen damage
- Cover of the Motor Vehicle against accidental loss or damage (up to market value at the time of accident)
- Cover of the Motor Vehicle against fire or theft (up to market value at the time of loss)
- Loss of or damage to the Motor Vehicle due to Flood & Strike, Riot & Civil Commotion
- Third Party Property and Injury Liability
- Legal liability of Passengers for Acts of Negligence
- Windscreen Cover
- Reimbursement of accident-related towing expenses (up to S$200)
- 24-hour Mobile Accident Response Service (MARS)
- Choice of Workshops with AutoExcel
- Option to protect your No Claim Discount (NCD)
- Complimentary windscreen benefit
- Option to enhance protection against third party property damages
- Additional coverage for Strikes, Riots or Civil Commotions, Floods, Typhoons, Hurricanes, Cyclones, Tornados and other convulsions of nature.
So there you go. We hope that this article has helped you make a better choice for the best commercial car insurance if you are a private hire driver!
Otherwise, head to GoBear's car insurance portal to find more policies.