There are occasions when your NTUC car insurance may need to be cancelled before it is due. When this happens you can get back the remaining (unused) value of your policy. As such, a little knowledge on how to estimate your refund value and how to cancel your policy may be helpful.

Why Do People Cancel Their Car Insurance Policy?

The most common reason is because they have sold their car and bought a new one. In this case, the existing insurance policy will not be applicable for the new car. Therefore it has to be cancelled and a new motor insurance policy enforced.

Secondly, if the car is lost through fire or theft, or if it is damaged beyond economical repair, it has to be scrapped. When this happens, the car insurance policy will automatically lapse. The market value of your vehicle will be paid out to you and you may choose to purchase another vehicle using the compensation.

As a side note, NTUC Income will not refund any unused policy value if at least one claim was made within the policy term. (This is generally the same for other insurers too.)

Another reason why an NTUC car insurance could be cancelled is because the details provided on the application form is incorrect. As such, the policy will not be valid since it is based on erroneous information. Therefore it has to be cancelled and a new contract reinforced.

An amendment (known as an endorsement) can be passed to correct minor mistakes though. Nevertheless the premiums may not remain the same.

What’s the Procedure like?

NTUC Income may cancel a car insurance policy by giving seven days’ notice at your last known address and you must return your original Certificate of Insurance to them.

You may also initiate the cancellation by notifying them in writing or by teleconversation. You must return your original Certificate of Insurance thereafter. The cancellation will take effect from the date NTUC Income receives your original Certificate of Insurance.

How To Calculate the Premium Refund?

The formula for premium refund depends on whether you’ll take up another insurance policy with NTUC Income within the next 90 days:

(i)    If you take up another NTUC Income policy within 90 days:

Premium Refund = Premium * Unexpired Period of Insurance / Original Period of Insurance

(ii)    Otherwise:

Premium Refund = 85% of Premium * Unexpired Period of Insurance / Original Period of Insurance

If the remaining unused premium is less than the minimum sum of $25, no refund will be made.

In summary, to cancel an NTUC car insurance policy, this is what you have to do:

1.    Email or call up NTUC
2.    Send in your Certificate of Insurance
3.    Wait for the refund cheque in your mailbox

Every NTUC car insurance policy you buy insures you against third party claim liabilities. This means if anyone (third party) sues you for losses or damages, your insurance policy can pay out the compensation. You won’t have to dip into your own pocket to handle such eventualities.

Under NTUC Income, you will be protected against legal liabilities due to any accident. Thus you are covered against any deaths or bodily injury you cause to anyone. And you are protected (up to S$5,000,000) from any potential damage you may cause to any property arising from any one accident.

If someone else drives your car and gets into an accident, he is also covered. This is provided he or she is not concurrently insured under other car insurance policies. The coverage even extends to any of your passengers who are getting in and out of your vehicle or simply riding in it.

This benefit also applies should you be driving any other car not belonging or hired to you, provided this particular car is not covered by any other insurance for any loss or liability.

Medical Expenses

NTUC Income pays you, your named driver or your passengers up to $300 for medical expenses. Each party must be injured whilst in your car as a direct and immediate result of an accident involving your vehicle. Also, the number of passengers in your vehicle at the time of the accident must not exceed its seating capacity.

Personal Accident Benefits

Payment for personal accident benefits is shown in the Scale of Compensation issued together with your Certificate of Insurance. Each of your passengers and authorised driver will receive half of the amount stated.

Under the scale of compensation, you may receive the following amounts in case of eventualities:

- Death: $20,000
- Total and irrecoverable loss of all sight in both eyes: $20,000
- Total loss by physical severance at or above the wrist or ankle of both hands or both feet or of one hand together with one foot: $20,000
- Total loss by physical severance at or above the wrist or ankle of one hand or one foot together with the total and irrecoverable loss of all sight in one eye: $20,000
- Total and irrecoverable loss of all sight in one eye: $10,000
- Total loss by physical severance at or above wrist or ankle of one hand or one foot: $10,000

Finally, please note that you will find many exclusions as you read through the policy wording. This is because the insurer does not want anybody to profit from accidents nor take advantage of any loopholes in their insurance policy.

Apart from NTUC car insurance, you can also opt for Chartis car insurance or AXA car insurance. If you need car insurance quotes from reputable insurance companies such as these (and more), click on www.motorinsurancesingapore.com to find out more.