How Much is New Car Insurance & How to Get It

While car dealerships in Singapore may facilitate car purchases, they typically require proof of insurance before releasing the vehicle.

In Singapore, car insurance is mandatory. You must have valid car insurance that meets the minimum legal requirements before driving. It is not an option to opt out of car insurance in Singapore.

Here’s what you need to know before you buy insurance for a new car in Singapore.

In Singapore, valid car insurance is mandatory before you can register and drive your new vehicle.

If you don’t currently have car insurance, you'll need to purchase a policy before driving your new car home. Compare different insurance providers instead of relying solely on dealership offers.

If you have an existing car insurance policy, inform your provider about your new car. Ensure the policy is updated before registration to avoid legal issues. Most insurers offer a grace period, but it's best to update immediately.

New cars typically have higher premiums due to their value. Factors like car model, driver profile, and No-Claim Discount (NCD) impact pricing. Factor this into your budget.

Be mindful of dealer upselling. They may offer additional insurance products like gap insurance. Compare external insurance options to avoid unnecessary expenses.

Learn More: The 3 Key Types of Car Insurance in Singapore

How to buy car insurance for a new car

In Singapore, car insurance is mandatory before you can register and drive your new vehicle. If you don’t have car insurance, you'll need to purchase a policy before driving your new car. Here’s how:

• Know your make, model, and year: Compare cars and identify your vehicle.

• Gather vehicle details: Include make, model, year, and expected Certificate of Entitlement (COE) details. Your driving history and No-Claim Discount (NCD) will also affect premiums.

• Compare insurance quotes: Compare premiums, excess (deductibles), and coverage (third-party vs. comprehensive).

• Submit an application: Most insurers allow online applications and approvals. If you lack complete car details, you can get a quote but finalise later. Dealerships may also assist with insurance.

• Purchase your vehicle: With proof of insurance, you can buy your car.

• Register with LTA: After securing insurance, you must complete vehicle registration with LTA before driving.

Learn More: 11 Fun (and Lesser-Known) Facts About Car Insurance For You Car Owners

How much is insurance on a new car?

New cars, with their higher value and advanced features, typically cost more to insure than older models. In Singapore, insurance premiums for new cars are influenced by the car's year, make, and model. 

Singapore mandates at least Third-Party Only (TPO) insurance for all vehicles.

Shop around and compare insurance quotes. Compare premiums, excess, and coverage options, such as Third-Party Only (TPO), which covers damage to others, Third-Party Fire & Theft (TPFT), which adds fire and theft protection, and Comprehensive Coverage, the most extensive option. 

Car insurance premiums vary based on driver's age, experience, NCD, car make/model, and annual mileage. COE also impacts overall car ownership costs, making insurance a key consideration.

Annual premiums vary by car type (sedans, SUVs, EVs) and whether the car is new or used. Usage-based insurance (UBI) or telematics policies may lower premiums for safe drivers.

To reduce premiums, maintain a clean driving record for maximum NCD, compare quotes from insurers like NTUC Income, FWD, Singlife, and Etiqa, and consider a higher excess to lower premiums.

Here's an overview of comprehensive car insurance costs for a few popular vehicle models:

*For a married male, 35 years old with more than 5 years driving experience, 50% NCD and 0 claims.
**Numbers taken from Great Eastern

Figures stated in the table above are only estimates and may not be accurate. Refer to your insurer for up to date information regarding quotes for car insurance policies.

Learn More: Compare and Find the Best Car Insurance Quotes of 2025 Online in Singapore

Determining the right car insurance coverage for your new vehicle

The car insurance you need depends on your car's age, ownership, and Singapore's legal requirements. Singapore mandates at least Third-Party Only (TPO) insurance for all vehicles. Here’s a breakdown of what you need to know.

Car insurance recommendations

TPO covers damage to others, but not your vehicle. Comprehensive coverage, which includes damage to your vehicle and medical expenses, is recommended for new cars.

If financing, lenders often require Comprehensive Coverage. If you own the car, choose between TPO, Third-party, fire and theft (TPFT) car insurance, or Comprehensive based on your budget.

Consider optional Personal Accident Coverage and No Claim Discount (NCD) Protector. Assess your risk factors, like usage and potential repair costs.

Compare policies from various different insurers. Consider deductibles and perks. Car insurance premiums in Singapore vary based on age, driving experience, NCD, car model, and mileage. COE also affects overall car costs.

Learn More: Which Car Insurance Add-ons Are Worth Spending On?

Full insurance coverage

In Singapore, 'full coverage' doesn't mean a single policy. It refers to a combination of coverages, typically a Comprehensive Car Insurance policy. This includes the legally required Third-Party Liability Insurance, Comprehensive Coverage for your own vehicle, and often additional benefits like roadside assistance, medical coverage, and theft protection.

Comprehensive insurance covers damage from events like fire, vandalism, natural disasters (such as flash floods common in Singapore), and theft. Collision insurance covers damage from accidents where you're at fault.

Gap insurance for cars

Gap insurance, sometimes called 'Guaranteed Asset Protection,' is crucial in Singapore due to the high cost of cars from the Certificate of Entitlement (COE). If your new car is totalled, it covers the gap between your outstanding loan and the car's market value. This is highly recommended if you're financing your vehicle, as Singapore's car market sees rapid depreciation.

For example, if you buy a new car for S$120,000 with a S$90,000 loan, and after two years, the car's value drops to S$70,000 while your loan is S$80,000, regular insurance only covers S$70,000 with a S$600 deductible. Gap insurance would cover the S$10,000 difference, preventing financial strain.

You can typically obtain full coverage and gap insurance as add-ons to comprehensive car insurance from major insurers. Some dealerships might bundle them into financing deals. It's wise to compare insurers to find the best deal, especially for new vehicles.

Learn More: 5 Things to Consider Before Buying Car Insurance in Singapore

Coverage for replacing a new car

If your new car is totalled or stolen, New Car Replacement Coverage ensures you get a brand-new replacement of the same make and model, not just the depreciated market value.

Unlike standard Comprehensive or Collision insurance in Singapore, which only reimburses the car's market value at the time of the accident, New Car Replacement Coverage bridges the gap caused by rapid depreciation. This is crucial in Singapore, where cars depreciate quickly due to the Certificate of Entitlement (COE) and its 10-year validity.

Without this coverage, you might have to pay thousands extra to replace a totalled new car. For instance, if a S$130,000 Toyota Corolla Altis is stolen after 1.5 years, standard insurance might only pay S$110,000 (minus deductible), but New Car Replacement Coverage would provide a brand-new replacement.

This coverage is typically available for new cars less than 1-2 years old and is offered by major Singaporean insurers as an add-on to Comprehensive Insurance or bundled into premium plans. Drivers should check if their insurer includes this benefit, as it's not always automatic.

Strategies to lower your new car insurance premiums in Singapore

So how can you buy the cheapest possible car insurance premium in Singapore? To secure the most competitive new car insurance rates in Singapore, it's crucial to compare quotes from multiple insurers. Utilise online comparison platforms like SingSaver, and make it a habit to regularly shop around for better deals. 

One effective way to lower your premiums is by increasing your deductible (excess), but ensure you can comfortably afford the out-of-pocket expenses in case of a claim. Remember, Singapore insurers often offer varying excess tiers for different claim types.

Explore potential discounts by bundling policies. Check if your current insurer offers savings when you combine car insurance with home, travel, or health policies. 

Also, inquire about available discounts, as Singapore insurers provide incentives for safe drivers with a No Claims Discount (NCD), vehicle safety features like anti-theft alarms and dashcams, and completion of defensive driving courses.

Maintaining a good No Claims Discount (NCD) is highly beneficial, as Singapore insurers reward claim-free drivers with discounts of up to 50%. Consider NCD protection add-ons to safeguard your discount even after making a claim. Before purchasing a new car, compare insurance costs for different models, as some vehicles may have higher premiums due to repair costs or theft likelihood.

When considering add-ons, avoid unnecessary extras that inflate your costs; only opt for riders that genuinely align with your coverage needs. Lastly, remember that while saving money is important, don't compromise on essential coverage. Aim for the best value policy, rather than simply the lowest premium.