ComGI 6th Ed Ver 1.2 - Chapter 4

4.
Motor Insurance
CHAPTER 4
MOTOR INSURANCE
CHAPTER OUTLINE
1. Introduction
2. Types Of Private Motor Car Insurance Coverage
3. Motor Insurance Documents
4. Scope Of Cover
5. Other Policy Provisions
6. Underwriting Considerations
7. Motor Claims Framework (MCF)
8. Commercial Motor Vehicle Insurance
9. Motor Fleet Insurance
10. Motor Trade Insurance
Appendix 4A – Commercial Motor Vehicle Insurance Policy
Appendix 4B – Motor Trade Policy (Road Risks)
LEARNING POINTS
After studying this chapter, you should be able to:
▪ understand the four main types of Private Motor Car Insurance coverage sold by insurers
in Singapore:
- Act Liability Only
- Third-Party Only
- Third-Party, Fire & Theft
- Comprehensive
▪ understand the purpose and functions of each of the following Motor Insurance
documents:
- Proposal Form
- Certificate of Insurance
- Cover Note
- Policy Document
- Endorsements
- Renewal Notice
- Claim Form
▪ know what Private Motor Car Insurance is all about
▪ understand the need for Private Motor Car Insurance
▪ understand the scope of cover, policy provisions and conditions, exclusions, extensions,
underwriting information required and claims of Private Motor Car Insurance
▪ know what Motor Claims Framework (MCF) is all about
▪ know what Commercial Motor Vehicle Insurance is all about
▪ understand the need for Commercial Motor Vehicle Insurance
▪ understand the scope of cover, policy provisions and conditions, extensions and claims
of Commercial Motor Vehicle Insurance
▪ know what Motor Fleet Insurance is all about
▪ understand how motor fleets are rated
Copyright reserved by the Singapore College of Insurance Limited [ComGI Version 1.2] 115
Commercial General Insurance
▪ understand the need for Motor Fleet Insurance

▪ know what Motor Trade Insurance is all about
▪ understand the need for Motor Trade Insurance
▪ understand the scope of cover, exclusions and extensions of Motor Trade (Road Risks)
Insurance
▪ understand the scope of cover and exclusions of Motor Trade (Internal Risks) Insurance
▪ know what a Combined Road and Garage Risks Insurance is all about
116 Copyright reserved by the Singapore College of Insurance Limited [ComGI Version 1.2]
4. Motor Insurance
1. INTRODUCTION
1.1 Before one can understand the coverage afforded by a Commercial Vehicle Motor
insurance policy, it is essential to understand the statutory requirements for
compulsory motor insurance in Singapore as well as the basics of Private Motor
Car Insurance not to mention the related insurance documentation. Much of the
terms, coverage and documentation related to Private Motor Car Insurance will
also be applicable to Commercial Vehicle Motor Insurance.
1.2 Under the Motor Vehicles (Third-Party Risks and Compensation) Act (Cap. 189)
[“the Act”], every user of a motor car in Singapore must have in force an
insurance policy, which provides him with indemnity for legal liabilities arising
from death or bodily injuries to a third party in connection with the use of a motor
car on the road. It is an offence to drive or to be in charge of a motor car on a
public road without Motor Insurance coverage in force. Insurance coverage is
required before registration of a new motor car by the Land Transport Authority
of Singapore (LTA).
1.3 Under Sections 10 and 14 of the Act, an insurer may be sued by a third party,
even though the third party is not a party to the insurance contract.
1.4 In accordance with the Act:

(a) the policy must be taken up with an approved insurer in Singapore;
(b) a Certificate of Insurance must be obtained from the insurer, otherwise the
insurance policy purchased shall be of no effect; and
(c) it is also a statutory requirement that the driver must produce a valid
Certificate of Insurance at any time, as and when required by the police.
1.5 The insured, including any named driver or authorised driver, must have a valid
licence to drive a motor car in Singapore. In addition, he must not be under
suspension or disqualified from driving under the Road Traffic Act (Cap. 276).
2. TYPES OF PRIVATE MOTOR CAR INSURANCE COVERAGE
2.1 There are four main types of Private Motor Car Insurance coverage generally sold
by insurers in Singapore. These are:
▪ Act Liability Only;
▪ Third-Party Only;
▪ Third-Party, Fire & Theft; and
▪ Comprehensive.
2.2 The type of insurance that is compulsory for the motor car owner to take up as
mentioned earlier is the Act Liability Only policy. Under such a policy, the insurer
agrees to indemnify the insured for his liability arising from using his motor car
on the road. This policy covers only death or bodily injuries to third parties
(including passengers). It does not cover property damage to third parties, nor
does it cover bodily injuries to the driver or damage to the insured motor car. This
policy also does not cover accidents that happen in other places (e.g. on private
property) which are not included in the definition of a “road” under the Act. Under
Section 2 of the Act, “road” means “any public road and any other road to which
the public has access, and includes bridges over which a road passes”.
2.3 The three types of covers are depicted in Diagram 4.1 below. They provide more
coverage than the Act Liability Only policy but do bear in mind that any insurance
coverage other than the Act requirements will be an optional consideration for
the insured motorist, subject to underwriting by the insurer.
Comprehensive
In addition to the
Third-Party, Fire cover granted by
&Theft Third-Party, Fire &
Third-Party Only Theft policy, this
In addition to the policy also covers a
cover granted by number of other risks.
In addition to the Third-Party Only
Act Liability Only cover granted by policy, this policy Accidental and
Act Liability Only also covers:
Minimum cover as policy, this policy malicious damage to
required by Motor also covers: the motor car that the
Vehicles (Third-Party ▪ indemnity to the insured owns, with
Risks and insured for loss of some exceptions.
▪ damage to third-
Compensation) Act, or damage to the
party’s property.
(Cap. 189): insured’s motor Other coverage
car as a result of includes:
▪ death or bodily fire or theft. - Medical Expenses;
injuries of third - Personal Accident
parties, including Benefits.
liability towards
passengers.
3. MOTOR INSURANCE DOCUMENTS
A. Proposal Form
3.1 A completed proposal form is required when an individual seeks to purchase a

Private Motor Car Insurance policy. The Private Motor Insurance underwriter relies
on the completed proposal form as the main source of information to assess the
risk presented. It is common for individuals seeking Motor Insurance coverage (or
intermediaries seeking quotes on their clients’ behalf) to obtain quotes first from
insurers, by entering the required key information into the insurers’ portals or
systems without completing the proposal form. Some insurers do require the
proposal form to be completed, when the insured eventually effects the coverage
with them.
B. Certificate Of Insurance
3.2 The Certificate of Insurance plays an important role in the statutory scheme of
compulsory insurance. This Certificate must be obtained from the insurer to show
4. Motor Insurance
the existence of the Private Motor Car Insurance, so that it can be shown to the
police as and when required.
C. Cover Note
3.3 In general, a cover note is issued as an interim document, pending receipt of other
details needed for the issue of a policy document and a Certificate of Insurance.
A cover note is a fully effective contract of insurance.
D. Policy Document
3.4 The policy document is not the contract but an evidence of the insurance
contract. It contains the precise terms, provisions, limitations, exclusions and
conditions, details of the coverage provided, definitions of terms and
supplementary information, such as advice on the dispute resolution procedures,
as well as the claim procedures.
E. Endorsements
3.5 Insurers use endorsements to record changes in the terms and conditions of the
standard insurance policy. For example, perils that are excluded in the standard
policy, such as flood, strike, riot and civil commotion damage, can be included
using endorsements.
F. Renewal Notice
3.6 While there is no legal obligation of an insurer to issue a renewal notice, it is a

good practice to do so. A renewal notice not only acts as a reminder to the
policyholder that the cover is about to expire, but also acts as an insurer’s sales
tool to help the insurer to retain business. Some insurers use it to upsell its
extensions or cross sell its other insurances.
G. Claim Form
3.7 The basic document required of the insured when making a claim is the claim
form. This claim form has been standardised and is now available online as an
accident report from any approved reporting centre or authorised workshop for
e-filing and reporting purposes, through the GIA Record Management Centre
system, in the event of an accident involving the insured motor car. Details on
reporting of motor accidents will be discussed under the Motor Claims Framework
in a later section of this chapter.
4. SCOPE OF COVER
4.1 Each Private Motor Car Insurance policy contains a number of sections covering
different aspects of the risks concerned. The four basic sections are:
▪ Section I - Insurance On The Motor Car;

▪ Section II - Liability To Third Parties;
▪ Section III - Medical Expenses; and
▪ Section IV - Personal Accident Benefits.
5. OTHER POLICY PROVISIONS
5.1 Other than the four main sections specifying the coverage, the Private Motor Car
Insurance policy includes some other important provisions.
A. Excess
5.2 Excess clauses are often included in Private Motor Car Insurance to curb small
claims. Excess is the first part of any claim that the insurer will not pay. Instead,
the insured will have to bear the amount himself. If the total claim amount is less
than or equal to the excess, nothing is payable by the insurer.
5.3 When the insurer imposes an excess, the insured will tend to be more careful
because if a claim occurs, the insured will also have to pay out-of-pocket and
contribute towards the claim. In general, the higher the excess, the more careful
will be the insured and, hence, the lower risk of having a claim. It is often meant
to limit the liability of the insurer, as well as to discourage small claims.
5.4 The reasons for imposing an Excess clause under Private Motor Car Insurance are
the same ones as those for the other classes of insurance, as described below:
▪ By making the insured responsible for a portion of the loss, the insurer hopes
to instil a greater sense of care and diligence on the part of the insured than
he would without it.
▪ Any large claim is reduced by the excess amount, thus reducing the liability to
the insurer.
▪ It does not make economic sense to the insurer to pay for very small claim
amounts, since there is usually a fixed cost involved in servicing each claim.
▪ Rather than terminating the policies of insureds with bad claims experience, a
higher excess may be offered, so that the insurance coverage can remain in
force and viable, keeping the premiums within financial reach.
5.5 An insured may request the insurer to remove or reduce the amount of excess by
agreeing to pay a higher premium. The insured may also volunteer for a higher
amount of excess than that imposed by the insurer, in exchange for a lower
premium payment. Some insurers will even waive the excess for the first claim
for one time only, if the repair to the damaged car is carried out by an approved
or authorised workshop.
5.6 Depending on the policy wording, the relevant types of excesses may be applied
to the policy under the respective headings as described below:
4. Motor Insurance
(a) Excess All Claims

Notwithstanding anything to the contrary contained in Section I “Insurance
On The Motor Vehicle” and Section II “Liability To Third Parties - damage
to third-party property”, the insured is responsible for the initial fixed
amount of claims (less any expenses already incurred, say, for the
protection of the damaged motor car) for each and every loss event.
However, if the expense incurred by the insurer includes the amount for
which the insured is responsible, the insured will be asked to repay such
amount to the insurer.
(b) Excess – Damage Claims
Notwithstanding anything to the contrary contained in Section I on
“Insurance On The Motor Vehicle”, the insured is responsible for an initial
predetermined amount of claim for each and every loss event.
(c) Elderly, Young And/Or Inexperienced Drivers Excess

This excess usually applies to any claim arising from Section I, and for any
claim arising from a driver being:
▪ an elderly person who is usually above the age of 70 years (or lower for
some insurers); or
▪ a young person who is usually under the age of 27 years (or lower for
some insurers); and/or
▪ an inexperienced driver who usually has driving experience of less than
two years (or one year for some insurers).
The amount of this excess which is usually high (e.g. S$3,000) varies from
insurer to insurer and usually applies in addition to any other existing excess.
(d) Unnamed Driver Excess
Similarly, this excess applies to any claim arising from Section I only, but is
operative for any claim arising from the car being driven by any person other
than the insured and any named driver as stated in the Schedule of the
Policy.
(e) Excess – Third-Party Property Damage
This excess applies to any claim arising from third-party property damage
(see Section II).
5.7 The excess as described in (a) to (e) usually does not apply to loss or damage
caused by fire, external explosion, self-ignition, lightning, burglary, housebreaking
or theft.
B. Insurance Discounts
5.8 These are described below:

(a) No Claim Discount (NCD)
No Claim Discount (NCD) is also known as “No Claim Bonus” or “No Claim
Entitlement”. A NCD is a financial incentive for the insured for not having
made any claim under the policy. In Singapore, if there is no claim made
during the period of insurance immediately before the renewal date of the
policy, the insurer will usually grant a NCD on the renewal premium. This is
one way to incentivise the driver to drive safely and cautiously.
The rate of discount for a private motor car is shown below:
Period Of Insurance Discount

The preceding year 10%
The preceding two consecutive years 20%
The preceding three consecutive years 30%
The preceding four consecutive years 40%
The preceding five consecutive years 50%
If a claim is made during the policy year while the insured is enjoying a NCD,
the NCD will be reduced at the next renewal of the policy, as shown below:
Number Of Claims
NCD At The Upon Policy Renewal,
During Period Of
Time Of Claim NCD Reduced To
Insurance
50% 1 20%
40% 1 10%
30% or less 1 Nil
50% or less 2 Nil
(b) Other Discounts

Besides NCD, other discounts applicable to Private Car Insurance are:
▪ Certificate Of Merit (COM) Discount
▪ Loyalty Discount
▪ Off-peak Car Discount
C. Conditions
5.9 Policy conditions are common for all forms of Private Motor Car Insurance
policies. They deal with the conduct between the two parties (i.e. the insured
and the insurer) of the insurance contract.
4. Motor Insurance
5.10 The majority of these conditions are listed under their individual headings, but
sometimes may be found under the general heading of “CONDITIONS”. The order
of the conditions may vary among insurers, but they normally deal with the
following matters:
C1. Geographical Area Of Coverage
5.11 A Private Motor Car Insurance policy applies to loss or damage or liability incurred
or sustained within the geographical area as defined in the Schedule of the Policy.
5.12 In Singapore, Private Motor Car Insurance applies only to the following countries
and geographical areas:
▪ when the motor car is in the Republic of Singapore, West Malaysia and that
part of Thailand within 80.5 km (50 miles) of the border between Thailand and
West Malaysia; or
▪ while in transit by sea during direct sea route across:
(i) the straits between the island of Penang and mainland West Malaysia; or
(ii) the straits between Changi Point, Singapore and Tanjong Berlungkor,
Johor.
C2. Jurisdiction Clause
5.13 The insurers will not be bound by judgements not in the first instance delivered
or obtained from a Court of Law within the Republic of Singapore or West
Malaysia.
C3. Transfer Of Policy
5.14 This provision pertains to the assignment of a Private Motor Car Insurance policy.
It generally states that, if the insurer consents to a transfer of interest in a Private
Motor Car Insurance policy, the period during which the interest has been vested
with the transferor will not accrue to the transferee.
5.15 That is to say, once the ownership of a motor car has been changed, the former
owner needs to cancel his policy, and the new owner must purchase a new
Private Motor Car Insurance policy.
C4. Avoidance Of Certain Terms & Right Of Recovery
5.16 This condition simply means that, if the insurer is required by legislation or any
other instrument to pay a claim for which the insurer is not otherwise liable under
the policy, the insurer can recover the amount of the paid claim from the insured.
5.17 Such obligations may arise by virtue of the legislation or the agreement made
between:
▪ the Minister of Transport of Malaysia and the Motor Insurers’ Bureau of West
Malaysia on 30 March 1992; or
▪ the Minister for Finance of Singapore and the Motor Insurers’ Bureau of
Singapore on 22 February 1975.
5.18 For example, if the insured is driving under the influence of alcohol and knocks
down a cyclist or pedestrian, the insurer will be required by legislation to pay a
claim for which it is otherwise not liable under the Private Motor Car Insurance
policy, as such claim is specifically excluded under the policy. Upon payment of
any such claim, the insurer will then seek recovery from the insured.
C5. Payment Before Cover Warranty
5.19 This clause requires the insured to pay the premium in full on or before the
effective date of insurance under the policy, renewal certificate, cover note,
and/or endorsement.
5.20 To meet this requirement, the premium must be paid and actually received in full
by the insurer, the registered broker or registered agent through whom the policy
is effected.
5.21 If this is not complied with, the policy will not be valid. As such, no benefit will
be payable by the insurance company. Any payment received thereafter will be
of no effect, as the policy is not valid.
C6. Limitations As To Use
5.22 The Private Motor Car Insurance policy is to provide protection when the motor
car is used only for social, domestic and pleasure purposes and for the insured’s
business.
5.23 The policy does not cover use of the motor car for hire or reward, tuition, driving
test, racing, pace-making, reliability trial, speed-testing, or for the carriage of
goods (other than samples) in connection with any trade or business, or use for
any purpose in connection with the motor trade or business.
5.24 Hence, private motor car owners who use their cars to ferry passengers in return
for a fare should get expanded Motor Insurance coverage, since private insurance
coverage restricts vehicle use to "social, domestic and pleasure purposes". Given
that most cases of injury claims may be of substantial amounts, a policyholder
will suffer heavy financial loss if he/she is not covered by an expanded Motor Car
Insurance policy.
C7. Death Of The Insured
5.25 In the event of death of the insured, this policy covers:
▪ any member of the insured’s family or a paid driver who has been driving the
motor car during the lifetime of the insured, and the permission to drive has
not been withdrawn prior to the death of the insured; and
4. Motor Insurance
▪ any other person who has been given permission to drive the motor car prior to
the death of the insured, and such permission has not been withdrawn by the
insured.
D. Other Conditions
5.26 Most of the following can be found under the policy heading titled
“CONDITIONS”.
▪ Interpretation;
▪ Written Notice;
▪ Care of Motor Car;
▪ Notification Of Accident;
▪ Claim Procedures;
▪ Cancellation;
▪ Other Insurance; and
▪ Arbitration.
E. General Exclusions
5.27 In addition to the specific exclusions under each section, there are a number of
general and market exclusions applicable to all sections of the policy.
5.28 Firstly, the insurer is not liable for any loss, damage or liability sustained or
incurred:
▪ outside the defined geographical area of coverage;
▪ while the motor car is being:
- used not in accordance to its “Limitations As To Use”;
- used or driven when it is not registered under the Road Traffic Act (Cap. 276)
or when its registration has been cancelled; or used or driven with
modifications not approved by LTA in accordance with the Road Traffic (Motor
Vehicles, Registration and Licensing) Rules;
- driven by any unauthorised driver; or
- driven by the insured, his named driver or his authorised driver while under
the influence of intoxicating liquor or drugs.
5.29 Secondly, the insurer is not liable for any accident, loss, damage or liability
(except those which meet the requirements of the legislation) arising out of or in
connection with:
▪ war, invasion, act of foreign enemies, hostilities or warlike operations (whether
war be declared or not), civil war, mutiny, rebellion, revolution, insurrection,
military or usurped power; or
▪ detention, seizure, confiscation or any attempt thereat.
5.30 Thirdly, if the insurer is not liable under the law, the policy or otherwise, any
special agreement made by the insured with a third party that gives rise to liability
will not be binding on the insurer.
5.31 Fourthly, as with war risks, all nuclear risks, including ionising, radioactivity,
existence or escape of any nuclear fuel, material or waste are considered to be
catastrophic risks which cannot be provided for or covered by insurance.
5.32 Lastly, the insurer will not pay for any loss, damage, cost or expenses caused by
or resulting from any act of terrorism, regardless of any other cause or event
contributing at the same time, as or in any other sequence to the loss. The insurer
will also not pay for any loss, damage, cost or expense of whatsoever nature
directly or indirectly caused by, resulting from or in connection with any action
taken in controlling, preventing, suppressing or in any way relating to any act of
terrorism.
F. Extensions
5.33 Some of the common extension relating to Private Motor Vehicle Insurance
include:
▪ Legal Liability Of Passengers
▪ Windscreen Damage
▪ Third Party Indemnity To Employer
▪ Strike, Riot & Civil Commotion (SRCC)
▪ Windstorm & Flood Damage
▪ Additional Personal Accident Benefits
▪ Loss of Use (Or Courtesy Car)
▪ Loss Of Personal Effects & Other Car Accessories
▪ NCD Protector
6. UNDERWRITING CONSIDERATIONS
6.1 When a motor insurance risk is presented to an insurance company, the underwriter
has to recognise that each insurable risk presents a different risk to the central pool.
Hence, a prudent insurer must exercise selection of risks and charge each potential
policyholder a “fair” premium which represents the degree of risk they bring to the
pool.
6.2 The following tend to be the main underwriting considerations for Private Motor Car
Insurance:
▪ Car Usage;
▪ Make and Model of the Car;
▪ Car Engine Capacity;
4. Motor Insurance
▪ Car Age;
▪ Driver Characteristics; and
▪ Types of Private Motor Car Insurance Cover.
7. MOTOR CLAIMS FRAMEWORK (MCF)
7.1 The industry-wide Motor Claims Framework (MCF) came into effect in Singapore
on 1 June 2008. It was an initiative of the General Insurance Association of
Singapore, to provide clear and common procedures for the reporting of motor
accidents. The MCF is fully supported by all motor insurers in Singapore. The MCF
provides motorists with an enhanced claims experience and at the same time, helps
contain claims costs for insurers.
A. Key Points Of The MCF
7.2 In case of accident, the motorist should avoid all unauthorised tow-truck operators
and repair workshops.
7.3 The motorist should exchange particulars of involved parties including:

▪ Name;
▪ NRIC/FIN;
▪ Telephone Number;
▪ Address; and
▪ Insurer.
7.4 The motorist should take note of the vehicle numbers.
7.5 The motorist needs to take pictures at the accident scene and submit all pictures at
the motorist’s authorised accident reporting centre during his reporting. He should
take photographs of:
(a) Scene: Pictures of the accident scene capturing the accident vehicles and
surrounding areas.
(b) Own Car: Pictures of the damage to the motorist’s own car capturing his
licence plate.
(c) Other Damaged Car(s)/Vehicle(s): Pictures of damage to all other
cars/vehicles involved in the accident capturing licence plates. For multiple
cars/vehicles collision, pictures of those with direct contact, e.g. immediate
front and immediate rear cars/vehicles.
7.6 Call the insurer’s hotline for a tow truck or for further advice on the accident.
7.7 Report and bring the accident car (whether damaged or not) to the approved
reporting centre/authorised workshop within 24 hours or by the next working day.
B. Benefits Of Reporting
7.8 By reporting the accident within the stipulated time, the motorist not only enjoy
hassle-free and quality-certified repair services, he will also avoid potentially higher
costs from exaggerated claims.
7.9 REMEMBER: All accidents must be reported to the motorist’s insurer’s approved
reporting centre/authorised workshop within 24 hours or by the next working day
[he must bring the accident car (whether damaged or not)], and irrespective of
whether he is claiming from any insurers or third parties.
C. Consequences For Failure To Report An Accident To The Insurer
7.10 If the motorist fails to report an accident to his insurer within the stipulated time
frame as stated above, he may face the following consequences:
▪ His insurer may repudiate liability because he has breached policy condition for
failure to report an accident. He will therefore not be protected under the policy
and will have to deal with his own repair costs and any Third-Party claims made
against him.
▪ His No Claims Discount will be docked upon the renewal of his policy.
▪ His insurer may also cancel or decline renewal of his policy.
D. How Do Motorists Benefit From The MCF?
7.11 Under the MCF, insurers assist policyholders in handling repairs of the damaged
vehicle, including assisting policyholders to file claims against a Third Party, if the
policyholder is not primarily liable.
7.12 Insurers provide a comprehensive service (via their approved reporting centres or
workshops) to encourage the motorist to report his accident with his accident
car/vehicle as well as have the repairs carried out at the approved workshops.
7.13 All motorists are required to do is to report to their insurers within 24 hours or the
next working day and to bring their accident vehicle to the insurers’ approved
reporting centres or workshops.
E. Does The Motorist Have To Inform His Insurer Even Though There Is No Damage
To His Car?
7.14 Yes, he must always report all accidents to his insurer no matter how minor the
accident may be, even if there is no visual damage or even if he has made a private
settlement with the other driver.
7.15 This is because he cannot be fully certain that the other party will not file a claim
against him later. He may find himself in a position of having his claim prejudiced or
declined later by insurers.
4. Motor Insurance
F. What Happens If The Motorist Chooses Not To Report The Accident To His Insurer?
7.16 Failure to do so will affect his No Claims Discount upon renewal of his motor
insurance and will prejudice his claim.
G. If The Motorist Brings His Accident Vehicle To The Authorised Reporting Centre Or
Workshop, How Much Does He Has To Pay For The Inspection, Survey And
Accident E-Filing Process?
7.17 There are no fees or charges involved in the reporting process.
8. COMMERCIAL MOTOR VEHICLE INSURANCE
A. Introduction
8.1 Many of the same principles as those of Private Motor Car Insurance are applied
in Commercial Motor Vehicle Insurance. While the former insures only private
cars, the latter insures all types of commercial vehicles (except for private cars
and motorcycles) that are owned by businesses. However, the period of cover,
parties to the contract, underwriting considerations, general exclusions and
claims are similar to those of Private Motor Car Insurance and so will not be
repeated here.
B. The Need For Commercial Motor Vehicle Insurance
8.2 Commercial Motor Vehicle Insurance is used by businesses to insure their

commercial vehicles, such as the following:
▪ goods carrying vehicles like vans, pick-ups, lorries, trucks, trailers and prime
movers;
▪ passenger carrying vehicles like hired cars (e.g. taxis), buses and coaches;
▪ agricultural, forestry and construction-related vehicles like tractors, excavators
and mobile cranes; and
▪ vehicles of special construction, known as “special types”, including vehicles
such as ambulances and forklift trucks.
8.3 Commercial Motor Vehicle Insurance is primarily concerned with the risks
attached to the motor vehicles themselves, while they are being driven or parked.
C. Scope Of Cover
8.4 The Commercial Motor Vehicle Insurance policy is structured into sections as
follows:
▪ Section I – Insurance On The Motor Vehicle;
▪ Section II – Liability To Third Parties; and
▪ Section III – Towing Disabled Vehicles.
8.5 As can be seen, it comprises fewer sections than those of the Private Motor Car
Insurance policy, and the “Towing Disabled Vehicles” section replaces the
“Medical Expense Benefit” section. Although there is no “Personal Accident
Benefit” section, this does not mean Personal Accident Benefits are not offered,
which we shall see later.
C1. Section I – Insurance On The Motor Vehicle
8.6 In contrast to the insurance coverage provided under Section I of a Private Motor
Car Insurance policy, the scope of cover under this section for commercial
vehicles is limited to the loss of or damage to the insured motor vehicle and its
accessories and spare parts caused by:
▪ accidental collision or overturning;
▪ fire, lightning, explosion, self-ignition, theft or break-in;
▪ malicious damage;
▪ strike, riot or civil commotion; or
▪ flood, typhoon, hurricane, volcanic eruption, earthquake or other convulsion of
nature.
8.7 However, similar to the coverage under Section I of a Private Motor Car Insurance
policy, it also covers the cost of removal after the accident and provides some
authority to the insured to repair damage to the motor vehicle. The exclusions are
also more or less the same ones as those of the Private Motor Insurance policy.
C2. Section II – Liability To Third Parties
8.8 This section provides the same indemnity as Section II of the Private Motor Car
Insurance policy, with some differences:
▪ any accident in connection with loading and unloading of the insured motor
vehicle is also covered; and
▪ no indemnity to the insured while driving another motor vehicle.
8.9 In addition to the exclusions under Section II of the Private Motor Car Insurance
policy, Section II of the Commercial Motor Vehicle policy also excludes:
▪ death, injury or damage to property caused by or arising out of the explosion
of a boiler forming part of or attaching to the insured motor vehicle; and
▪ damage to any bridge, weighbridge, viaduct or any road caused by the
vibration of or weight of the motor vehicle, or of the load carried by it.
C3. Section III – Towing Disabled Vehicles
8.10 If the insured motor vehicle is being used to tow any disabled vehicle, the
insurance under Section II “Liability To Third Parties” shall be provided to cover
for any liability in connection with the towed vehicle, except when it is being
towed for reward. However, damage to the towed vehicle itself, or the property
being conveyed by it, is not covered.
4. Motor Insurance
D. Policy Provisions & Conditions
8.11 The important provisions and conditions (e.g. excess) were considered under
Private Motor Car Insurance. They equally apply to Commercial Motor Vehicle
Insurance. However, the NCD provision differs in terms of quantum of discount
offered.
D1. No Claim Discount (NCD)
8.12 The rate of NCD for commercial vehicles (including motorcycles) is shown in the
table below:
Period Of Insurance Discount

The preceding three or more consecutive years 20%
8.13 Unlike the NCD for private cars, there will be no discount granted on the next
policy renewal, once a claim is made in respect of a commercial vehicle.
8.14 Example: Billy was enjoying a NCD of 20% for his van when he met with a road
accident, and he made a claim under his Comprehensive Commercial Vehicle
Insurance policy. What NCD percentage will he be entitled to upon the next
renewal of his policy?
Answer: Nil
E. Extensions
8.15 Extensions under a Commercial Motor Vehicle Insurance policy may be offered
under a “Comprehensive” plan, or by paying additional premiums. Many of the
extensions available under the Private Motor Car policy are also offered here.
These include:
▪ legal liability of passengers; and
▪ windscreen damage.
8.16 In addition, the following extensions are also offered:

(a) Third-Party Property Damage Limit Of Indemnity: It is usually possible to
increase the limit of liability for third-party property damage;
(b) Personal Accident Benefits: This may be extended to cover the paid
driver/attendant, and/or the passengers, in direct connection with the
insured motor vehicle and caused by accidental means. Benefits are
provided according to a “Scale of Compensation”; and
(c) Third-Party Working Risk: This extension covers third-party liability arising
from the use of the insured motor vehicle as a working risk, e.g. in the case
when the cranes are fitted onto the motor vehicles, i.e. when the cranes
are being operated, while the motor vehicles are not moving on the roads.
Refer to Appendix 4A for a specimen Commercial Motor Vehicle Insurance
Policy.
F. Claims
8.17 The claim procedures for Commercial Vehicle Insurance (as well as Motorcycle
Insurance) are the same in many aspects as those of the Private Motor Car
Insurance. Hence, they are not repeated here.
8.18 However, it is worth noting that, while most Private Motor Car Insurance policies
use the “market value” as a basis for claims, the “market value” may not be
applicable to some commercial vehicles, such as taxis, and motor vehicles used
in certain restricted roads like airports, ship ports, military and naval bases. The
values for such motor vehicles are agreed on other bases e.g. Straight-Line
Depreciation and Book Value. The cover is usually offered on a sum insured basis.
9. MOTOR FLEET INSURANCE
A. What Is Motor Fleet Insurance?
9.1 Motor Fleet Insurance is used to insure a fleet of vehicles under a single policy.
A fleet is simply a number of motor vehicles owned by a firm or corporation. It
can be a fleet of private cars, motorcycles, goods-carrying vehicles, or other types
of vehicles (or even a mixture of vehicle types).
9.2 Fleets are rated on past experience (meaning past claims experience of the fleet)
with the assumption that past experience is a guide to possible future experience.
For this assumption to have any statistical backing, there must be a sufficient
number of vehicles (e.g. 10 or more) and a sufficient loss history for assessment.
9.3 Ten vehicles have always been thought of as being the minimum number of
vehicles necessary to be classed as a fleet. However, competition in the insurance
market has resulted in some insurers accepting a smaller number of vehicles (e.g.
five) as a fleet. A span of three or five years’ loss history is required for the
timescale. The following subsection explains how a fleet may be rated.
A1. Fleet Rating
9.4 The usual method for rating of a motor fleet of vehicles is to sum up the total
losses paid and any outstanding losses over the past three years. These figures
are then adjusted for inflation, so that they represent, as nearly as possible, the
equivalent in today’s money.
9.5 A factor known as a “vehicle year” is then determined. This is defined as the
4. Motor Insurance
insurance of one vehicle for one year. Vehicles owned or used for only part of a
year are treated on a proportionate basis. In this way, dividing the total of the
losses (adjusted for inflation) by the total number of vehicle years, the underwriter
is able to assess the risk on a realistic basis. Figure 4.1 illustrates how the risk
assessment for fleet rating purposes is determined.
Figure 4.1: Fleet Rating Method

Step 1: Determine the total losses paid over the past three years:
Any Outstanding Losses

Total Total Losses Over The
+ Over The Past Three =
Losses Paid Past Three Years*
Years*
* Adjustments will be made to cater for inflation, so that they
represent, as nearly as possible, the equivalent in today’s money.
Step 2: Determine the “vehicle year”.
Step 3: Risk Assessment by Underwriter:
Total Losses Over The Past Three Years

(Adjusted For Inflation)
Total Number Of Vehicle Years
9.6 To establish the projected claims cost (i.e. the claims cost which is likely in the
forthcoming year), it is also necessary to take into account such factors as the
increasing amount of awards for bodily injury claims, and the trends in the costs
of motor vehicle repairs.
9.7 The following example illustrates the application of the fleet rating method as
explained in Figure 4.1.
Example 4.1 Application Of The Fleet Rating Method
ABC Motor Transport Pte Ltd operates a fleet of 10 commercial buses. The
details of this fleet and each vehicle’s original registration (purchase) date is
shown in the table below. All the vehicles have been insured under a fleet
policy for the past 3 years. The period for the current fleet policy is due to
expire in a couple of months i.e. on 31 Dec 2022 and the underwriter wishes
to establish the projected claims cost i.e. the claims cost which is likely in the
forthcoming year i.e. 1 Jan to 31 Dec 2023.
Bus No. Registration Vehicle Remarks

Date Year
PA 1234A 1 Jan 2020 3.00 1 Jan 2020 to 31 Dec 2022
= 3 years
PA 4567B 1 Jan 2020 3.00
PA 4321C 1 Jan 2020 3.00

PA 7654D 1 Jan 2020 3.00
PC 6666G 1 July 2021 1.50 1 July 2021 to 31 Dec 2022
=1.5 years
PC 7777F 1 Jan 2022 1.00 1 Jan 2022 to 31 Dec 2022
=1 year
PC 7899H 1 July 2022 0.50 1 July 2022 to 31 Dec 2022
=0.5 years
PC 8888A 1 July 2022 0.50
PC 8899F 1 Oct 2022 0.25 1 Oct 2022 to 31 Dec 2022
=0.25 years
PC 9999Z 1 Oct 2022 0.25
Total Vehicle Years 16.00
Assuming that the total losses over the past 3 years (after adjustment is made
for inflation) amounts to S$400,000, then the underwriter assesses the risk
by applying the formula mentioned above (see Figure 4.1) as follows.
S$400,000/ 16= S$25,000 per vehicle year.
As mentioned above, it is also necessary to take into account such factors as

the increasing amount of awards for bodily injury claims, and the trends in
the costs of motor vehicle repairs. Assuming that these factors amount to
20%, then the above computed figure per vehicle year now works out to be
S$30,000 per vehicle year.
If there is no purchase of new vehicles and no sale of current vehicles in

2023, then the total vehicle years for 2023 is 10 (10 vehicles multiplied by
1 year each). The projected claims cost i.e. the claims cost which is likely in
the forthcoming year (1 Jan to 31 Dec 2023) works out to be S$300,000
i.e. S$30,000 per vehicle year multiplied by 10 vehicle years.
By dividing the total of the losses (adjusted for inflation) by the total number
of vehicle years, the underwriter is able to assess the risk on a realistic basis
as compared to simply dividing the total of the losses by the number of
vehicles. The latter approach assumes that all vehicles were on risk for 3
years. This is obviously incorrect as for example, the last 2 vehicles were only
on risk for 3 months each in 2022 as they were only registered in October
2022 and so on.
B. The Need For Motor Fleet Insurance
9.8 Besides providing the convenience of having a single policy for all the motor
vehicles, insuring motor vehicles under a fleet basis may also provide possible
discounts in rating owing to quantity and savings in administrative costs.
9.9 Both Private Motor Car Insurance and the Commercial Motor Vehicles Insurance
may be insured on a fleet basis – the schedule of the policy will itemise each
motor vehicle, or in some rare cases, give a general description of the class of
4. Motor Insurance
vehicles owned by the insured company (e.g. a car-rental company owning many
cars, a travel agency owning many coaches, a hospital owning many ambulances,
or a courier service company owning many motorcycles for use by despatch
riders).
9.10 The same policy format under an “individual” vehicle basis is also used for a fleet
basis. However, the policy is usually endorsed to the effect that the NCD does
not apply to a fleet-rated policy.
9.11 We will not repeat the rest of the sections (e.g. parties to the contract, scope of
cover, etc.) as these have been discussed earlier.
10. MOTOR TRADE INSURANCE
A. What Is Motor Trade Insurance?
10.1 Motor Trade Insurance policies are designed for businesses that deal primarily
with motor vehicles, such as car dealers and car repairers. Some insurers may
use a specially adapted Commercial Motor Vehicle Insurance policy for such risks.
They do so by adding suitable endorsements to the policy, so as to cover all of
the insured’s vehicles while in the insured’s care, custody or control, while being
driven on the road, or while being kept in the business premises. Of course, there
are specific covers for motor trade risks, such as the Motor Trade Insurance
policies.
B. The Need For Motor Trade Insurance
10.2 Businesses involved in the motor trade always have a fluctuating number of motor
vehicles in their possession and on their premises. Some motor vehicles belong
to the motor dealer and some belong to other persons, including customers. Many
different persons will need, or want to drive the motor vehicles, including
employees, customers, and potential customers. Hence, it is clearly not possible
to arrange the insurance cover in the same way as a normal one-to-one Motor
Insurance policy. Over the years, insurers have devised an
arrangement to make covers as efficient as possible, and the result is the
following three main kinds of Motor Trade policies:
▪ Motor Trade (Road Risks);
▪ Motor Trade (Internal Risks); and
▪ Combined Road and Garage Risks.
C. Motor Trade (Road Risks) Insurance
C1. Scope of Cover
10.3 This form of Motor Trade Insurance can be “Third-Party Only”, “Third-Party, Fire
and Theft” or “Comprehensive” coverage for motor vehicles for which the insured
is responsible, while the vehicles are:

▪ on the road; or
▪ temporarily garaged during the course of a journey elsewhere, other than in or
on any premises owned by or in the occupation of the insured.
10.4 The policy consists of only two main insurance sections:

(a) Section I: "Loss Or Damage"
This is similar to that of the Commercial Motor Vehicle Insurance, in that it
covers loss of or damage to the motor vehicles against named perils, such
as accidental collision, overturning, fire, explosion, etc. It also provides cost
of removal after an accident. However, malicious acts are not covered.
The whole of Section I is not operative under a “Third-Party Only” cover.

However, under a “Third-Party, Fire and Theft” cover, damage to the motor
vehicles caused only by fire, external explosion, self-ignition, lightning,
burglary, housebreaking or theft is covered.
(b) Section II: "Liability To Third Parties"

This covers the insured and any authorised driver for the legal liability in the
event of accidents caused by or arising out of the use of the insured motor
vehicles, very much the same coverage as that under a Commercial Motor
Vehicle Insurance policy. For damage to property of third parties, some
insurers impose a limit of S$500,000 in respect of any one claim or series
of claims arising out of one event.
C2. Exclusions
10.5 Other than the usual exclusions that relate to strike, riot, civil commotion, war
and nuclear risks, the common exclusions specific to this class of insurance are
as follows:
▪ loss of or damage to the motor vehicle outside the geographical area;
▪ being driven by an unauthorised driver; and
▪ driving under the influence of alcohol or drugs.
C3. Extensions
10.6 There are also certain benefits that can be added, sometimes, for additional
premiums to enhance the coverage. Such extensions are described below:
(a) Strike, Riot & Civil Commotion (SRCC): Comprehensive policies may be
extended to cover SRCC for an additional premium.
(b) Private Use: Arrangements can be made, without additional premium, to

indemnify:
▪ any member, director or employee of the insured; or
4. Motor Insurance
▪ any named relative or friend of a member or director of the insured, while

using the insured vehicle for social, domestic and pleasure purposes with
the insured’s permission.
(c) Driving Extensions:

▪ Demonstration – Arrangements can be made to include driving for
purposes of demonstration by a person, who is not the insured’s
employee, while being accompanied by the insured or the insured’s
employee. Additional premium is imposed for this extension.
▪ Tuition – Arrangements can be made, with additional premium, to include
driving for purposes of tuition by a person, who is not the insured’s
employee, while being accompanied by the insured or the insured’s
employee.
(d) Natural Disaster: It is possible to extend coverage for risks like flood,
typhoon, hurricane, volcanic eruption, earthquake or other convulsions of
nature by paying an additional premium.
(e) Competitions: It is possible to extend coverage for competition, such as

racing, speed event, rally, reliability trial, etc., by paying an additional
premium.
Refer to Appendix 4B for a specimen Motor Trade policy (Road Risks).
D. Motor Trade (Internal Risks) Insurance
D1. Scope Of Cover
10.7 Motor Trade (Internal Risks) Insurance, as the name implies, provides coverage
for accidents that happen only inside the insured’s premises. Just like the Motor
Trade (Road Risks) Insurance policy, it provides cover under two main insurance
sections as described below:
(a) Section I: "Insurance On The Motor Vehicle" – This provides cover for
accidental damage to the insured motor vehicles occurring on the insured’s
premises, while the motor vehicle is being driven. It excludes loss resulting
from depreciation, mechanical breakdown, etc., and damage to tyres by
application of brakes or by punctures, cuts or bursting.
(b) Section II: "Liability To Third Parties” – This covers the insured's legal
liability in respect of:
(i) accidental death of or bodily injury to any person, other than a person
working for the insured or a member of the insured's family or
household; and
(ii) accidental damage to:
(1) any motor vehicle held in trust by or in the care, custody or
control of the insured (e.g. customer’s vehicles); and
(2) other property not belonging to, or held in trust by, or in the
care, custody or control of the insured, occurring in the insured’s
premises (accidental damage may occur through the negligence
of the insured or any person working for the insured, or through
the defects in any work, machinery or plant in the premises). For
damage to property of third parties, some insurers impose a limit
of S$500,000 in respect of any one claim or series of claims
arising out of one event.
D2. Exclusions
10.8 Other than the usual general exclusions that relate to wars, riots, strikes, and
nuclear risks, the common exclusions specific to this class of insurance are as
follows:
▪ damage to property owing to fire or explosion;
▪ theft, burglary or housebreaking;
▪ damage to property while it is being worked upon;
▪ defective workmanship;
▪ any loss as a result of the premises undergoing demolition, alteration, etc.;
▪ contractual agreement;
▪ any loss or damage while the vehicle is being driven elsewhere
other than the premises of the insured; and
▪ damage to vehicles owing to weather conditions.
E. Combined Road & Garage Risks Insurance
10.9 The Combined Road and Garage Risks Insurance policy combines in one policy
the cover given by the two previously described policies, namely the Motor Trade
(Road Risks) Insurance and the Motor Trade (Internal Risks) Insurance. It usually
includes the theft risk relating to the premises. As part of their marketing of this
policy, many insurers include additional benefits, such as damage to petrol
pumps.
4. Motor Insurance
Appendix 4A
ABC INSURANCE COMPANY (SINGAPORE) LIMITED

(Registration No: 2009-12345-A)
21 Any Street, ABC Centre, Singapore 654321
Tel: (65) 6789 8181 Fax: (65) 6789 8282
E-mail: contactus@abcinco.com.sg
Website: www.abcinco.com.sg
COMMERCIAL MOTOR VEHICLE INSURANCE POLICY

Here is your Insurance Policy. Please examine it together with the Schedule, to make sure that You have the protection You need.
It is important that the Policy, the Schedule and any amendments are read together to avoid misunderstanding.
If there are any changes that may affect the insurance provided, please notify Us immediately.
IMPORTANT NOTICE
The insurance cover provided to you under this Policy is based on the information You have provided to Us.
Please be reminded that You must fully and faithfully declare to Us the facts that You know or ought to know,
otherwise You may receive no benefit from the Policy.
HOW YOUR INSURANCE OPERATES
Your Commercial Vehicle Insurance Policy is a contract between Us, the Company, and You, Our Insured named in the Schedule. The
application form, declaration and any information given form the basis of this contract.
The insurance We provide in this Policy is subject to the terms, conditions, exclusions contained in this Policy, Certificate of Insurance, the
Schedule and any Endorsement to this Policy (hereinafter collectively referred to as the “Terms of this Policy”).
In consideration of Your paying to Us the required Premium, We agree to indemnify You in the manner and to the extent described in the
Policy and in the Schedule, in respect of events occurring during the Period of Insurance, or any subsequent period for which You pay and
We accept the required Premium.
OUR PROMISE OF SERVICE

We wish to provide You with a high standard of service and to meet any claims covered by the Policy honestly, fairly and promptly. Should
You have any reason to believe that We have not done so, please contact Your broker or agent. If You do not use the services of a professional
intermediary, please contact Us directly.
A GUIDE TO YOUR COMMERCIAL VEHICLE POLICY
Definition of Words An explanation of words used in this Policy which have special meanings
Section I Insurance on the Insured Vehicle
Section II Liability to Third Parties
Section III Towing Disabled Vehicles
No Claim Discount (NCD) Your NCD entitlement
General Exclusions Those events We do not insure under the Policy as a whole
Claims Conditions What You should do if You need to make a claim
General Conditions Your rights and Our rights under the Policy
Limits of Liability
Endorsements
DEFINITION OF WORDS
(Applicable to the whole Policy)
Certain words have been defined below. These have the same meaning wherever they are used in the Policy. They appear in bold print
(e.g. Insured) or begin with a capital letter (e.g. You, Your)
Authorised Driver
Any person driving Your vehicle on Your order or with Your permission. The person must have a valid driving license to drive in Singapore
and is not under any suspension or disqualification by law to drive.
Geographical Area
1. The Republic of Singapore
2. West Malaysia
3. Transit by direct sea route across:
(i) the straits between the island of Penang and the mainland of West Malaysia;
(ii) the straits between Changi Point, Singapore and Tanjong Belunkor, Johor;
subject to the Insured and other person for the time being in charge of the Insured Vehicle having complied in all things with the
rules, regulations or lawful directions of the carrier.
4. That part of Thailand within 80 kilometres of the border between Thailand and West Malaysia.
Insured Vehicle
The vehicle We are insuring for You as shown in the Schedule.
Insured You/Your
The policy owner named as Insured in the Schedule.
Schedule
A document which is part of the Policy which gives details of the cover You have.
We/Us/Our/the Company
ABC Insurance Company (Singapore) Limited
SECTION I – INSURANCE ON THE INSURED VEHICLE
1. Loss or Damage
The Company will indemnify the Insured against loss of or damage to the Insured Vehicle and its accessories and spare parts
caused:
(a) by accidental collision or overturning or collision or overturning consequent upon mechanical breakdown or consequent
upon wear and tear;
(b) by fire, external explosion, self-ignition, lightning, impact by falling object, burglary, housebreaking or theft.
(c) by flood, typhoon, hurricane, cyclone, tornado, volcanic eruption, earthquake or other convulsion of nature;
(d) by malicious act;
and occurring within the Geographical Area.
At its own option, the Company may pay in cash the amount of the loss or damage or may repair, reinstate or replace the
Insured Vehicle or any part thereof or its accessories or spare parts. The liability of the Company shall not exceed the value of
the parts lost or damaged and the reasonable cost of fitting such parts. Our maximum liability shall be limited to the prevailing
market value of the Insured Vehicle at the time of loss or damage.
2. Loss or Damage to Windscreen or Window and In Vehicle Unit (IU)

The Company will pay the cost of reinstating any glass in the windscreen or windows including glass roof of the Insured Vehicle
and the cost of reinstating the IU (if applicable) of the Insured Vehicle following breakage of such glass provided there is no
other damage to the Insured Vehicle.
Notwithstanding the coverage provided above, the Insured shall be responsible to pay for the first S$100 or the amount
specified as Windscreen Excess in the Schedule and its applicable goods and services tax (GST), whichever is higher amount for
each and every claim made under this sub-section.
Payment by Us under this sub-section will not affect Your No Claim Discount.
3. Protection and Removal after Accident

If the Insured Vehicle is disable by reason of loss or damage insured under this Policy, the Insured shall take prompt steps to
ensure the safety of the vehicle, its accessories and spare parts and the Company will pay the reasonable cost of protection and
removal to the nearest repairer and of delivery within the Geographical Area up to S$300 per accident.
4. Authority to Repair
The Insured may authorise the repair of the Insured Vehicle necessitated by damage for which the Company may be liable
under this Policy provided that:
(a) the estimated cost of such repair does not exceed the Authorised Repair Limit, and
(b) a detailed estimate of the cost is forwarded to the Company without delay.
EXCLUSIONS TO SECTION I
The Company shall not be liable to pay for:
1. consequential loss, loss of use, depreciation, wear and tear, mechanical or electrical breakdowns, failures or breakages;
2. damage to tyres unless the Insured Vehicle is damaged at the same time;
4. Motor Insurance
3. damage caused by overloading or strain;

4. damage caused to Insured Vehicle by explosion of any boiler forming part of or attached to or on the Insured Vehicle;
5. the Excess amount is shown in the Schedule and its applicable GST for every claim made against the Company under this Section. This
excess shall not apply to loss or damage caused by fire, explosion, self-ignition or lightning or burglary, housebreaking or theft;
6. any equipment or computer malfunction; or
7. the failure or inability of any equipment or any computer program to recognize or correctly interpret or process any date as the true
or correct date, or to continue to function correctly beyond that date
SECTION II – LIABILITY TO THIRD PARTIES
1. Indemnity to the Insured

The Company will subject to the Limits of Liability indemnify the Insured in the event of an accident caused by or arising out of the
use of the Insured Vehicle or in connection with the loading or unloading of the Insured Vehicle within the Geographical Area against
all sums including claimant’s costs and expenses which the Insured shall become legally liable to pay in respect of:
(a) death of or bodily injury to any person;
(b) damage to property.
2. Indemnity to Authorised Driver

The Company will subject to the Limits of Liability indemnify any Authorised Driver who is driving the Insured Vehicle provided that
such Authorised Driver:
(a) shall as though he were the Insured observe, fulfil and be subject to the Terms of this policy insofar as they can apply; and
(b) is not entitled to indemnity under any other policy.
3. Indemnity to Legal Personal Representatives

In the event of the death of any person entitled to indemnity under this Section, the Company will in respect of the liability incurred
by such person indemnify his legal personal representatives in terms of and subject to the limitations of such section provided that
such representatives shall as though they were the Insured observe, fulfil and be subject to the Terms of this Policy insofar as they
apply.
4. Expenses
The Company will pay all costs and expenses incurred with its written consent.
5. Limits of Liability
In the event of accident involving indemnity under this Section to more than one person, the Limits of Liability shall apply in the
aggregate amount of indemnity to all persons indemnified and such indemnity shall apply in priority to the Insured.
6. Representation and Defence

The Company may at Our own option:
(a) arrange for representation at any inquest or inquiry in respect of any death, injury or damage which may be the subject of
indemnity under this Section;
(b) undertake the defence of proceedings in any Court of Law in respect of any act or alleged offence causing or relating to any event
which may be the subject of indemnity under this Section; and
(c) subject to the Limits of Liability, the Company may at the request of the Insured arrange and pay for legal services for defence of
any charge of causing death by driving the Insured Vehicle other than murder which may be brought against the Insured or an
Authorised Driver in respect of any death which may be the subject of indemnity under this Section.
EXCLUSIONS TO SECTION II
The Company shall not be liable to pay for:
1. death or bodily injury to any person in the employment of the Insured arising out of and in the course of such employment;
2. damage to property belonging to the Insured or held in trust by or in the custody or control of the Insured or any member of the
Insured’s household or being conveyed by the Insured Vehicle;
3. death, bodily injury or damage caused or arising beyond the limits of any carriageway or thoroughfare in connection with the
bringing of the load to the Insured Vehicle for loading thereon or the taking away of the load from the Insured Vehicle after
unloading therefrom;
4. damage to any bridge, weighbridge, viaduct or to any road or anything beneath by vibration or by the weight of the Insured Vehicle
or of the local carried by the Insured Vehicle;
5. death, bodily injury or damage to property caused by or arising out of the explosion of a boiler forming part of attached to or on the
Insured Vehicle except so far as is necessary to meet the requirements of the relevant legislation; or
6. damage to underground pipe lines, cables or installations of any description.
SECTION III – TOWING DISABLED VEHICLE
The Policy shall be operative whilst the Insured Vehicle is being used for the purpose of towing any one disabled mechanically propelled
vehicle and the Company will indemnity the Insured in terms of Section II in respect of liability in connection with such towed vehicle
provided that:
1. such towed vehicle is not towed for reward; and

2. the Company shall not be liable by reason of this Section in respect of damage to such towed vehicle property being conveyed thereby.
NO CLAIM DISCOUNT (NCD)
In the event of no claim being made or arising under this Policy during a Period of Insurance specified below immediately preceding the
renewal of this Policy the renewal premium shall be reduced as follows:
Period of Insurance Discount
If more than one Insured Vehicle is described in the Schedule, the NCD shall be applied as if a separate policy had been issued in respect of
such Insured Vehicle.
If the Company shall consent to a transfer of interest in this Policy, the period during which the interest was in the transferor shall not accrue
to the benefit of the transferee.
The NCD shall be affected by any late notification or any failure in notification of an accident and/or occurrence by the Insured in accordance
with Sub-Section 1 of Claims Conditions.
GENERAL EXCLUSIONS
The Company shall not be liable in respect of:

1. any accident, injury, loss, damage or liability caused sustained or incurred:
(a) outside the Geographical Area;
(b) whilst the Insured Vehicle in respect of which indemnity is provided by this Policy is:
(i) being used otherwise than in accordance with the Limitations as to Use,
(ii) being driven by or is for the purpose of being driven by the Insured or in the charge of any person other than an Authorised
Driver,
(iii) being driven by the Insured or an Authorised Driver whilst under the influence of intoxicating liquor or drugs,
(iv) being used or driven when it is not registered or licensed under the legislation or when the registration or licensing under
the relevant legislation has been cancelled, or
(v) being used or driven with modifications that have not been approved by the Registrar of Vehicles in accordance with the
Road Traffic (Motor Vehicles, Registration and Licensing) Rules or by any relevant regulatory authority.
2. any liability which attaches by virtue of an agreement but which would not have attached in the absence of such agreement.
3. any sum which the Insured would have been entitled to recover from any party but for an agreement between the Insured and such
party.
4. any death, disability, loss, damage, destruction, any legal liabilities, cost or expense including consequential loss of whatsoever nature,
directly or indirectly caused by, resulting from or in connection with any of the following regardless of any other cause or event
contributing concurrently or in any other sequence to the loss:
(a) war, invasion, acts of foreign enemies, hostilities or warlike operations (whether war be declared or not), civil war, rebellion,
revolution, insurrection, civil commotion assuming the proportions of or amounting to an uprising military or usurped power;
(b) any act of terrorism including but not limited to:
(i) the use or threat of force, violence and/or,
(ii) harm or damage to life or to property (or the threat of such harm or damage), including but not limited to nuclear radiation
and/or contamination by chemical and/or biological agents.
by any person(s) or group(s) of persons, committed for political, religious, ideological or similar purposes, express or otherwise,
and/or to put the public or any section of the public in fear; or
(c) any action taken in controlling, preventing, suppressing or in any way relating to (a) or (b) above.
If the Company alleges that by reason of this exclusion, any loss damage, cost or expense is not covered by this insurance, the
burden of proving the contrary shall be upon the Insured.
5. any loss, damage, liability or expense directly or indirectly caused by or contributed to by or arising from:
(a) ionising radiations from or contamination by radioactivity from any nuclear fuel or from any nuclear waste or from the
combustion of nuclear fuel;
(b) the radioactive, toxic, explosive or other hazardous or contaminating properties of any nuclear installation, reactor or other
nuclear assembly or nuclear component thereof;
(c) any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter;
(d) the radioactive, toxic, explosive or other hazardous or contaminating properties of any radioactive matter. The exclusion in this
sub-clause does not extend to radioactive isotopes, other than nuclear fuel, when such isotopes are being prepared, carried,
stored, or used for commercial, agricultural, medical, scientific or other similar peaceful purposes; or
(e) any chemical, biological, bio-chemical or electromagnetic weapon.
4. Motor Insurance
6. any loss or damage occasioned directly or indirectly by or through or in consequence of any of the following occurrences namely:
(a) permanent or temporary dispossession resulting from confiscation, nationalisation, commandeering or requisition by any lawfully
constituted authority;
(b) permanent or temporary dispossession of Insured Vehicle resulting from the unlawful occupation or possession of such Insured
Vehicle by any person, provided that the Company is not relieved of any liability to the Insured in respect of physical damage to
the Insured Vehicle occurring before dispossession or during temporary dispossession which is otherwise covered by this Policy;
or
(c) the destruction of Insured Vehicle by order or any public authority.
In any action, suit or other proceeding where We allege that by reason of the provisions above any loss, destruction or damage is
not covered by this insurance, the burden of proving that such loss, destruction or damage is covered shall be upon the Insured.
7. any claim or provide any benefit hereunder to the extent that the provision of such cover, payment of such claim or provision of such
benefit would expose the Company to any sanction, prohibition or restriction under United Nations resolutions or the trade or
economic sanctions, laws or regulations of the European Union or United Kingdom or United States of America.
CLAIMS CONDITIONS
1. Notification of Accidents
In the event of any accident involving the Insured Vehicle, irrespective of whether it would give rise to a claim, the Insured shall
report the accident to the Company or Our Authorised Representative and convey or cause to be conveyed the Insured Vehicle to
the Our Authorised Representative for Inspection within 24 hours of the accident or by the next working day thereof.
In case of theft or other criminal act which may give rise to a claim under this Policy, the Insured shall give immediate notice of the
occurrence to the Company and the police and shall co-operate with the Company in securing the conviction of the offender.
Every letter, claim, writ, summons and process shall be notified or forwarded unanswered to the Company immediately upon
receipt. Notice shall also be given to the Company immediately after the Insured or any person claiming to be indemnified shall have
knowledge of any impending prosecution, inquest, inquiry, or offer of composition in connection with any such accident and/or
occurrence.
This condition in its entirety is a condition precedent to liability and failure to comply with any of the above requirements in respect
of an accident and/or occurrence will result in the Insured being denied indemnity under both Section I and Section II of the Policy in
respect of that particular accident and/or occurrence. Notwithstanding the No Claim Discount provisions set out herein, failure to
comply with this condition precedent will additionally result in the Insured losing all or part of his/her No Claim Discount as set out
up in the Table below.
COMMERCIAL VEHICLES NCD

Upon Renewal
Current
(Non-Reporting)
20% 15%
15% 10%
10% 0%
0% 0%
*The Accident NCD to be applied first before the Non-Reporting NCD.

In the context of this clause the following terms have the following meanings assigned to them:
*Accident NCD – Refers to the loss of percentage of No Claim Discount entitlement as a result of claims arising from an accident.
*Non-Reporting NCD – Refers to the loss of percentage of No Claim Discount as a result of not reporting or late reporting of an accident.
2. Claims Procedure
(a) No admission, offer, promise or payment shall be made by or on behalf of the Insured or any person claiming to be indemnified
without the written consent of the Company. The Company shall be entitled at its sole discretion to:
(i) take over and conduct in the name of the Insured or such person the defence or settlement of any claim;
(ii) prosecute in the name of the Insured or such person for its own benefit any claim for indemnity or damages or otherwise;
and/or
(iii) conduct and settle proceedings as the Company deem fit.
(b) The Insured accepts that the Company has these rights and that to evaluate and exercise these rights, the Insured and any person
claiming to be indemnified must assist the Company by:
(i) providing all such information and assistance as the Company may require; and
(ii) allowing the Company the right to examine the nature and extent of all damage to the Insured Vehicle before it is repaired.
The Company has this right whether or not is entitled or intends to claim an indemnity under this Policy for the damage to
the Insured Vehicle.
(c) In case damage to the Insured Vehicle is indemnifiable by this Policy, the Insured shall decide whether or not to claim for such
damage under this Policy and if so claiming, shall submit such a claim to the Company within fourteen (14) days of occurrence or
discovery of damage. The quoted cost of repair is subject to adjustment by the Company before any repair may commence if it
exceeds the Authorised Repair Limit in total.
3. Other Insurance
If at the time any claim arises under this Policy there is any other insurance covering the same loss, damage or liability, the Company
shall not be liable to pay or contribute more than its rateable proportion of any loss, damage, compensation, costs or expenses.
Provided always that nothing in this Condition shall impose on the Company any liability from which but for this Condition it would
have been relieved under proviso 2(b) of Section II of this Policy.
4. Relinquish Defence and Representation

At any time after the happening of any event giving rise to a claim or series of claims under the Policy, the Company may pay to the
Insured the full amount of the Company’s liability and relinquish the conduct of any claim defence or proceedings and the Company
shall not be responsible for any damage, loss or liability alleged to have been caused to the Insured in consequence of any alleged act
or omission of the Company in connection with such claim, defence or proceedings or of the Company relinquishing such conduct
nor shall the Company be liable for any costs or expenses whatsoever incurred by the Insured or any claimant or other person after
the Company shall have relinquished such conduct.
5. Arbitration
If there is any dispute as to the liability and/or amount to be paid under this Policy, such dispute shall be determined by arbitration
in accordance with the statutory provisions on arbitration in that behalf for the time being in force. It is hereby expressly stipulated
that it shall be a condition precedent to any right of action or suit upon this Policy that an arbitration award shall be first obtained.
If the dispute shall not within twelve (12) months from the date of disclaimer of liability or date of rejection of the offer made have
been referred to arbitration under the provisions of this Policy, then such claim shall for all purposes be deemed to have been
abandoned and shall not thereafter be recoverable as provided for under the Terms of this Policy.
6. Time Limit of Commencement of Action or Suit

If an action or suit is not commenced within twelve (12) months after the arbitration award is made under Condition 5 of this Policy,
the Company shall not be liable for such claim under this Policy and such claim shall be all purposes be deemed to have been
abandoned and shall not thereafter be recoverable against the Company.
GENERAL CONDITIONS
1. Interpretation
This Policy and the Schedule shall be read together as one contract and any word or expression to which a specific meaning has been
attached in any part of this Policy or Schedule shall bear such specific meaning wherever it may appear.
2. Written Notice
Every notice of communication to be given or made under this Policy shall be delivered in writing to the Company.
3. Care of Insured Vehicle

The Insured shall take all reasonable steps to safeguard the Insured Vehicle from loss or damage and to maintain Insured Vehicle in
efficient condition and the Company shall have at all times free and full access to examine the Insured Vehicle or any part thereof or
any driver or employee of the Insured. In the event of any accident or breakdown, such vehicle shall not be left unattended without
proper precautions being taken to prevent further loss or damage and if Insured Vehicle be driven before the necessary repairs are
effected any extension of the damage or any further damage to Insured Vehicle shall be excluded from the scope of the indemnity
granted by this Policy.
4. Cancellation
The Company may cancel this Policy by giving seven (7) days’ notice by registered letter to the Insured at his last known address. The
Insured may also cancel this Policy by returning the original Certificate of Insurance and the cancellation will take effect from the date
the Company receives the original Certificate of Insurance. Any refund will be calculated as follows:
(d) Cancellation by the Company
Premium X Unexpired Period of Insurance (days)

Original Period of Insurance * (days)
(e) Cancellation by the Insured
Premium X Unexpired Period of Insurance (days) X 80%

Original Period of Insurance * (days)
Definition
*Original Period of Insurance of this Policy shall be deemed to include any extension of Period in the Policy. No refund will be payable
if the refund premium is less than S$25 or where a claim (including claim for windscreen or windows or In Vehicle Unit (IU) has arisen
under the Policy.
5. Exclusion of Rights under the Contracts (Rights of Third parties) Act
4. Motor Insurance
A person who is not a party of this Policy contract shall have no right under the Contracts (Rights of Third Parties) Act (Cap53B) to
enforce any of its terms.
6. Condition Precedent
(Applicable to Policy issued to business or commercial establishment)
The validity of this Policy is subject to the condition precedent that:

(a) for the risk insured, the Insured has never had any insurance terminated in the last twelve (12) months due solely or in part to a
breach of any premium payment condition; or
(b) if the Insured has declared that it has breached any premium payment condition in respect of a previous policy taken up with
another insurer in the last twelve (12) months:
(i) the Insured has fully paid all outstanding premium for time on risk calculated by the previous insurer based on the customary
short period rate in respect of the previous policy; and
(ii) a copy of the written confirmation from the previous insurer to this effect is first provided by the Insured and the Company
before cover incepts.
7. Premium Payment Warranty

(Applicable to Policy issued to business or commercial establishment)
(a) Notwithstanding anything herein contained but subject to clause (b) hereof, it is hereby agreed and declared that if the Period of
Insurance is sixty (60) days or more, any premium due must be paid and actually received in full by the Company (or the
intermediary through whom this Policy was effected) within sixty (60) days of the inception date of the coverage under the Policy,
Renewal Certificate or Cover Note.
(b) In the event that any premium due is not paid and actually received in full by the Company (or the intermediary through whom
this Policy was effected) within the sixty (60)-day period referred to above, then:
(i) the cover under the Policy, Renewal Certificate or Cover Note is automatically terminated after the expiry of the said sixty
(60)-day period;
(ii) the automatic termination of the cover shall be without prejudice to any liability incurred within the said sixty (60)-days
period; and
(iii) the Company shall be entitled to a pro-rata time on risk premium subject to a minimum S$25.
(c) If the Period of Insurance is less than sixty (60) days, any premium due must be paid and actually received in full by the Company
(or the intermediary through whom this Policy was effected) within the Period of Insurance.
8. Payment before Cover Warranty

(Applicable to Policy issued to an individual)
(a) Notwithstanding anything herein contained but subject to clause (b) below hereon, it is hereby agreed and declared that the
total premium due must be paid and actually received in full by the Company (or the intermediary through whom this Policy
was effected) on or before the inception date (“the inception date”) of the coverage under the Policy, Renewal Certificate or
Cover Note.
(b) In the event that the total premium due is not paid and actually received in full by the Company (or the intermediary through
whom this Policy was effected) on or before the inception date referred to above, then the Policy, Renewal Certificate, Cover
Note and Endorsement shall not attach and no benefits whatsoever shall be payable by the Company. Any payment received
thereafter shall be of no effect whatsoever as cover never attached and the Policy, Renewal Certificate or Cover Note.
9. Conditions Precedent to the Company’s Liability

The due observance and fulfilment of the terms, provisions and conditions of this Policy insofar as they relate to anything to be done
or not to be done by the Insured and the truth of the statements and answers in the proposal shall be conditions precedent to any
liability of the Company to make payment under this Policy.
10. Legal Personal Representative

The Terms of this Policy, so far as applicable and with any necessary modifications, shall apply to the legal personal representative of
the Insured and Authorised Driver.
11. Jurisdiction Clause

The indemnity under this Policy shall not apply in respect of judgements which are not in the first instance delivered by or obtained
from a Court of competent jurisdiction within West Malaysia or the Republic of Singapore.
12. Avoidance of Certain Terms and Right of Recover

If the Company is obliged by virtue of the Legislation or the Agreement executed between the Minister of Transport of the
Government of Malaysia and the Motor Insurer’s Bureau of West Malaysia on 30 March 1992 or the Agreement executed between
the Minister for Finance of the Republic of Singapore and the Motor Insurer’s Bureau of Singapore on 22 February 1975 or by any
agreement which alters, amends or supersedes such Agreement, to pay an amount for which the Company would not otherwise be
liable under this Policy, the Insured shall repay the amount to the Company.
LIMITS OF LIABILITY
Limit of the amount of the Company’s liability under Section II – item 1 (a) in respect of any one
Unlimited
claim or series or claims arising out of one event
Limit of the amount of the Company’s liability under Section II – item 1 (b) in respect of any one
S$500,000
claim or series or claims arising out of one event
Limit of the amount of the Company’s liability under Section II – item 6 (c) in respect of legal
S$3,000
services for defence in the event of any change
Authorised Repair Limit

S$350
Limitation as to Use
As detailed in the Schedule
Legislation
Road Transport Act 1987 (Malaysia), Motor Vehicles (Third Party Risks a Compensation) Act (Cap.189) Republic of Singapore, Road
Traffic Act (Cap 276) (Republic of Singapore) or any Amendment, Act or Acts passed in substitution. The reference of Legislation under
the heading “Avoidance of Certain Terms and Right of Recovery” is limited to Sections 94, 95, 96 of the Road Transport Act 1987
(Malaysia) and Sections 7, 8 and 9 of the Motor Vehicles (Third Party Risks & Compensation) Act (Republic of Singapore).
ENDORSEMENTS
The Policy is extended to cover the following Endorsements, subject otherwise to the Terms of this Policy.
Strike, Riot and Civil Commotion

It is hereby understood and agreed that this Policy is extended to cover any accident, loss, damage or liability directly caused by:
1. the act of any person taking part together with others in any disturbance of the public peace (whether in connection with a strike
or lock-out or not) or the action of any lawfully constituted authority in suppressing or attempting to suppress any such
disturbance or in minimising the consequences of such disturbance, or
2. the wilful act of any striker or locked out worker done in furtherance of a strike or in resistance to a lock-out or the action of any
lawfully constituted authority in preventing or attempting to prevent any such act or in minimising the consequences of such act.
In the event of any claim under this Policy, the Insured shall prove that the accident, loss, damage or liability arose independently of
and was in no way connected with or occasioned by or contributed to by or traceable to any of the said occurrences or any
consequence thereof and in default of such proof the Company shall not be liable to make any payment in respect of such a claim.
Replacement Parts
It is hereby understood and agreed notwithstanding anything to the contrary contained in this Policy that in the event of loss of
damage to the Insured Vehicle or its accessories or spare parts necessitating the supply of a part not obtainable from stocks held in
the country in which the Insured Vehicle is held for repair or in the event of the Company exercising the option under Section I to
pay in cash the amount of the loss or damage the liability of the Company in respect of any such part shall be limited to:
(a) (i) the price quoted in the latest catalogue or price list issued by the manufacturer or his agents for the country in which
the Insured Vehicle is held for repair; or
(ii) if no such catalogue or price ists exists the price last obtaining at the manufacturer’s works plus the reasonable cost
of transport otherwise than by air to the country in which the Insured Vehicle is held for repair and the amount of
the relative import duty; and
(b) the reasonable cost of fitting such part.
Private use – Indemnity to Person Using

It is hereby understood and agreed that whilst the Insured Vehicle is being used by the person noted in the Schedule for social,
domestic or pleasure purposes with the permission of the Insured, the Company will in the terms of and subject to the limitations of
and for the purposes of Section II of this Policy indemnify the person using the Insured Vehicle in respect of any act or omission of the
driver provided that:
(i) such person is not entitled to indemnity under any other Policy; and
(ii) such person shall as though he were the Insured observe, fulfil and be subject to the Terms of this Policy insofar as they can apply.
Legal Liability of Passengers for Acts of Negligence

It is hereby understood and agreed that whilst the Company will at the request of the Insured indemnify in terms of Section II of this
Policy, any person mounting into, dismounting from or travelling in the Insured Vehicle such person being hereinafter called “the
Passenger”.
4. Motor Insurance
Provided that the Passenger:

(i) is not driving the Insured Vehicle or in charge of the Insured Vehicle for the purpose of driving;
(ii) is not entitled to indemnity under any other Policy; and
(iii) shall as though he was the Insured observe, fulfil and be subject to the Terms of this Policy in so far as they can apply.
Exceptions:
The Company shall not be liable in respect of:
(a) death of or bodily injury to any person in the employment of the Passenger where such death or bodily injury arises out of or in
the course of such employment; and
(b) damage to property belonging to or held in trust by or in the custody or control of the Insured or of the Passenger or being
conveyed by the Insured Vehicle.
Cover Whilst Driven by a Motor Trader

It is hereby understood and agreed that notwithstanding anything contained to the contrary in the Limitations as to Use but subject
otherwise to the Terms of this Policy, the insurance granted thereby shall be operative but only so far as it relates to the Insured
whilst the Insured Vehicle is in the custody of a member of the motor trade for the purpose of overhaul, upkeep or repair.
Hire Purchase
It is hereby understood and agreed that the Owners specified in the Schedule (hereinafter referred to as the Owners) are the owners
of the Insured Vehicle which is the subject of a Hire Purchase Agreement made between the Owners of the one part and the Insured
of the other part. It is further understood and agreed that any payment made in respect of loss or damage (which loss or damage is
not made good by repair reinstatement or replacement) under Section I of this Policy shall be made to the Owners as long as they are
owners of the Insured Vehicle and their receipt shall be a full and final discharge to the Company in respect of such loss or damage.
It is also understood and agreed that notwithstanding any provision in the Hire Purchase Agreement to the contrary this Policy is
issued to the Insured named in the Schedule as the principal party and not as agent or trustee for the Owners and nothing herein
shall be construed as constituting the Insured an agent or trustee for the Owners or as an assignment (whether legal or equitable) by
the Insured to the Owners of his rights benefits and claims under this Policy. It is lastly understood and agreed that the Insured shall
not assign his rights, benefits and claims under this Policy without the prior consent in writing of the Company.
Non-Cancellation Clause (General)

The Company undertakes to advise the Bank or Finance House noted in the Schedule prior to the cancellation of this Policy if
instructions have been received for the cancellation from the Insured and also to advise the aforesaid Bank or Finance House as soon
as possible of any material changes which are proposed to be made in the terms of the insurance.
POLICY OWNERS’ PROTECTION SCHEME

This policy is protect under the Policy Owners’ Protection Scheme which is administered by the Singapore Deposit Insurance
Corporation (SDIC). Coverage for your policy is automatic and no further action is required from you. For more information on the
types of benefits that are covered under the scheme as well as the limits of coverage, where applicable, please contact your insurer
or visit the GIA/LIA or SDIC websites (www.gia.org.sg or www.lia.org.sg or www.sdic.org.sg).
IMPORTANT – The Insured is requested to read this Policy. If any error or misdescription be found, the Policy should be
returned to the issuing office for correction.
Appendix 4B
ABC INSURANCE COMPANY (SINGAPORE) LIMITED

(Registration No: 2009-12345-A)
21 Any Street, ABC Centre, Singapore 654321
Tel: (65) 6789 8181 Fax: (65) 6789 8282
E-mail: contactus@abcinco.com.sg
Website: www.abcinco.com.sg
MOTOR TRADE POLICY (ROAD RISKS)
(WARNING)
1. Premium Warranty Clause requires the premium to be paid in full within a specific period failing which there would be no liability
under the policy, renewal certificate, cover note and endorsement, etc.
2. We would remind you that you must disclose to us, fully and faithfully, the facts you know or ought to know, otherwise you may
not receive any benefit from your policy.
WHEREAS the insured by a proposal and declaration which shall be the basis of this contract and is deemed to be incorporated herein has
applied to the ABC Insurance Company (Singapore) Limited (hereinafter called the Company) for the insurance hereinafter contained and
has paid or agreed to pay the Premium as consideration for such insurance.
NOW THIS POLICY OF INSURANCE WITNESSETH:-

That in respect of events occurring during the Period of Insurance whilst the Motor Vehicle is on the road or is temporary garaged during
the course of a journey elsewhere than in or on any premises owned by or in the occupation of the insured and subject to the terms exception
and conditions contained herein or endorsed hereon (hereinafter collectively referred to as the Terms of this policy).
SECTION I – LOSS OR DAMAGE
1. The Company will indemnify the Insured against loss of or damage to the Motor Vehicle and its accessories and spare parts whilst
thereon
(a) by accidental collision or overturning or collision of overturning consequent upon mechanical breakdown or consequent upon
wear and tear
(b) by fire external explosion self-ignition or lightning or burglary housebreaking or theft
2. All its own option the Company may pay in cash the amount of the loss of damaged or may repair reinstate or replace the Motor
Vehicle or any part thereof or its accessories or spare parts. The liability of the Company shall not exceed the value of the parts lost
or damaged and the reasonable cost of fitting such parts. The maximum amount payable by the Company in respect of any claim for
loss or damage shall not exceed the value of the motor vehicle including accessories and spare parts thereon at the time of the loss
or damage.
3. If the Motor Vehicle is disabled by reason of loss or damage insured under this Policy, the Company will subject to the Limits of
Liability bear the reasonable cost of protection and removal to the nearest repairers and of delivery within the country where the loss
of damage was sustained.
EXCEPTIONS TO SECTION I
The Company shall not be liable to pay for

(i) Consequential loss depreciation wear and tear mechanical or electrical breakdowns failures or breakages
(ii) damage caused by overloading or strain
(iii) damage to tyres unless the Motor Vehicle is damaged at the same time
(iv) loss of or damage to accessories or spare parts by burglary housebreaking or theft unless the Motor Vehicle is stolen at the same
time
SECTION II – LIABILITY TO THIRD PARTIES
1. The Company will subject to Limits of Liability indemnify the insured in the event of accident caused by or arising out of the use of
the Motor Vehicle or in connection with loading or unloading of the Motor Vehicle against all sums including claimant’s cost and
expenses which the insured shall become legally liable to pay in respect of
(a) death of or bodily injury to any person
(b) damage to property
2. In terms of and subject to limitations of and for the purpose of this Section, the Company will indemnify and Authorised driver who
is driving the Motor Vehicle provided that such Authorised Driver
(i) shall as though he were the insured observe fulfill and be subject to the terms of this policy insofar as they can apply
(ii) is not entitled to indemnity under any other policy
4. Motor Insurance
3. In the event of the death of any person entitled to indemnity under this section, the Company will in respect of the liability incurred
by such person indemnify his personal representatives in terms of and subject to the limitations of such Section provided that such
representatives shall as though they were the insured observe fulfill and subject to the Terms of this Policy insofar as they apply
4. The Company will pay all costs and expenses incurred with its written consent
5. In the event of accident involving the indemnity under this section to more than one person, the Limits of Liability shall apply to the
aggregate amount of indemnity to all persons indemnified and such indemnity shall apply in priority to the insured
6. The Company may as its own option

(a) arrange for representation at any inquest or fatal inquiry in respect of any death which may be the subject of indemnity under
this Section
(b) undertake the defence of proceedings in any Court of Law in respect of any act or alleged offence causing or relating to any event
which may be the subject to indemnity under this Section
EXCEPTIONS TO SECTION II
The Company shall not be liable in respect of

(i) death, bodily injury or damage caused or arising beyond the limits of any carriageway or thorough-fare in connection with the
bringing of the load to the Motor Vehicle for loading thereon or the taking away of the load from the Motor Vehicle after unloading
therefrom
(ii) death of or bodily injury to any person in the employment of the insured arising out of and in the course of such employment
(iii) death of or bodily injury to any person (other than a passenger carried by reason of or in pursuance of a contract of employment)
being carried in or upon or entering or getting on to or alighting from the Motor Vehicle at the time of the occurrence of the event
out of which any claim arises
(iv) damage to property belonging to held in trust by or in the custody or control of the Insured or a member of the Insured’s household
or being conveyed by the Motor Vehicle
(v) damage to any bridge, weight-bridge or viaduct or to any road or anything beneath by vibration or by the weight of the Motor
Vehicle or of the load carried by the Motor Vehicle
NO CLAIM DISCOUNT
In the event of no claim being made or arising under this Policy during a period of insurance specified below immediately preceding the
renewal of the Policy the renewal premium of such part of the insurance as is renewed shall be reduced as follows:
Period of Insurance Discount

If the Company shall consent to a transfer of interest in this Policy the period during which the interest was in the Transferor shall not accrue
to the benefit of the Transferee
If more than one motor vehicle is described in the Schedule the No Claim Discount shall be applied as if a separate Policy had been issued
in respect of each such motor vehicle
AVOIDANCE OF CERTAIN TERMS AND RIGHT OF RECOVERY
Nothing in this Policy or any endorsement hereon shall affect the right of any person entitled to indemnity under this Policy or of any other
person to recover an amount under or by virtue of the Legislation or the Agreement executed between the Minister of Transport of the
Government of Malaysia and the Motor Insurers’ Bureau of West Malaysia on 15th January 1968 or the Agreement executed between the
Minister for Finance of the Republic of Singapore and the Motor Insurers’ Bureau of Singapore on 22nd February 1975.
BUT the insured shall repay to the Company all sums paid by the Company which the Company would not have been liable to pay out for
the Legislation or such Agreement.
GENERAL EXCEPTIONS
The Company shall not be liable in respect of

1. any accident loss damage or liability caused sustained or incurred
(a) outside the Geographical Area
(b) whilst the Motor Vehicle is
(i) being used otherwise than in accordance with the Limitation as to Use
(ii) being driven by or is for the purpose of being driven by him in charge of any person other than an Authorised Driver
(iii) being driven by any person, whether it be the Insured himself or any person on his order or with his permission, whilst
under the influence of intoxicating liquor or drugs to such an extent as to be incapable of having proper control of the
vehicle as defined in the Road Traffic (Amendment) Act 1976.
any accident loss, damage or liability (except so far as is necessary to meet the requirements of the Legislation) directly or indirectly
proximately or remotely occasioned by contributed to by or traceable to or arising out of or in connection with flood, typhoon,
hurricane, volcanic eruption, earthquake or other convulsion of nature invasion the act of foreign enemies, hostilities or warlike
operations (whether war be declared or not) civil war, strike, riot, civil commotion, munity, rebellion, insurrection, military or
usurped power or by any direct or indirect consequences of any of the said occurrences and in the event of any claim hereunder
the Insured shall prove that the accident loss damage or liability arose independently of and was in no way connected with or
occasioned by or contributed to by traceable to any of the said occurrences or any consequence thereof and in default of such
proof the Company shall not be liable to make any payment in respect of such a claim
2. any liability which attaches by virtue of an agreement but which would not have attached in the absence of such an agreement
3. any sum which the insured would have been entitled to recover from any party but for an agreement between the Insured and
such party
4. (a) any accident loss or damage to any property whatsoever or any loss or expense whatsoever resulting therefrom or resulting
therefrom or any consequential loss
(b) any liability of whatsoever nature directly or indirectly caused by or contributed to by or arising from ionising radiation or
contamination by radioactivity from any nuclear fuel or from any nuclear waste from the combustion of nuclear fuel. For the
purpose of this exception combustion shall include any self-sustaining process of nuclear fission
5. any accident loss damage or liability directly or indirectly caused by or contributed to by arising from nuclear weapons material
if a law or laws are named in a section of the policy entitled “Avoidance of certain terms and right of recovery” or in the Policy
Schedule under the heading of “Legislation” all references to specific Section of such laws are deemed to be deleted so that the
reference to such law or laws are left to apply to each law in its entirety
ENDORSEMENTS
The following Endorsements only apply to this Policy when specifically mentioned in the Schedule and are subject otherwise to the terms of
this Policy
1. Excess – All Claims
It is hereby understood and agreed that notwithstanding anything to the contrary contained in this Policy the Insured in respect of
each and every event shall be responsible for the amount specified in the Schedule (or any less expenditure which may be incurred)
of any expenditure for which provision is made thereunder
If the expenditure incurred by the Company shall include the amount for which the Insured is responsible hereunder such amount
shall be repaid by the insured to the Company forthwith
For the purpose of this Endorsement the expression “event” shall mean an event or series of events arising out of one cause in
connection with the motor vehicle
This Endorsement shall not apply to loss or damage caused by fire external explosion self-ignition burglary housebreaking or theft
2. Excess – Damage Claims
It is hereby understood and agreed that notwithstanding to the contrary contained in Section I of this Policy the Insured in respect
of each and every event shall be responsible for the amount specified in the Schedule (or and less expenditure which may be
incurred) of any expenditure for which provision is made thereunder
If the expenditure incurred by the Company shall include the amount for which the insured is responsible hereunder such amount
shall be repaid by the insured to the Company forthwith
For the purpose of this Endorsement the expression “event” shall mean an event or series of events arising out of one cause in
connection with the Motor Vehicle.
This Endorsement shall not apply to loss or damage caused by fire, external explosion, self-ignition lightning, burglary,
housebreaking or theft
3(a) Third Party Only
It is hereby understood and agreed that Section I (and its exceptions) of this Policy is cancelled
It is further understood that and agreed that the printed wording of Condition 3 of the Policy is also cancelled and is replaced by
the following new Conditions:
“3. The Insured shall take all reasonable steps to maintain the Motor Vehicle in efficient condition and the Company shall have
at all times free and full access to examine the Motor Vehicle or any part thereof or any driver or employee of the insured”
4. Motor Insurance
3(b) Third Party Fire and Theft
It is hereby understood and agreed that notwithstanding anything to the contrary contained in Section1 (and its Exceptions) of this
Policy the Company shall not be liable thereunder except in respect of loss or damage by fire, external explosion, self-ignition,
lightning, burglary, housebreaking or theft
30. Replacement Parts
It is hereby understood and agreed that notwithstanding anything to the contrary contained in this Policy in the event of loss or
damage to the Motor Vehicle or its accessories or spare parts necessitating the supply of a part not obtainable from stocks held in
the Country in which the Motor Vehicle is held for repair or in the event of the Company exercising the option under Section 1-2 to
pay in cash the amount of the loss or damage the liability of the Company in respect of any such part shall be limited to :-
(a) (i) the price quoted in the latest catalogue or price list issued by the Manufacturer or his Agents for the Country in which the
Motor Vehicle is held for repair or
(ii) if no such catalogue or price list exist the price last obtained at the Manuacturer’s Works plus the reasonable cost of
transport otherwise than by air to the Country in which the Motor Vehicle is held for repair and the amount of the relative
import duty
and
(b) the reasonable cost of fitting such part
SPECIAL CONDITION
PREMIUM WARRANTY CLAUSE
1. Notwithstanding anything herein contained to the contrary and subject only and without prejudice to Clause 2 hereinafter set out,
it is hereby declared and agreed that it is a condition precedent to liability under this Policy, Renewal Certificate, Endorsement or
Cover Note that any premium due must be paid and actually received in full by the Company, the registered broker or registered
agent through whom this policy was effected:-
(a) when the period of insurance is 60 days or more, within SIXTY (60) days from the :-
(i) INCEPTION date of the coverage under the Policy, Renewal Certificate or Cover Note; or
(ii) EFFECTIVE date of the coverage stated on each Endorsement, if any, issued under the Policy, Renewal Certificate or
Cover Note when the effective date of coverage stated on the Endorsement is on or after the issuance date of the
Endorsement; or
(iii) ISSUANCE date of each Endorsement, if any issued under the Policy, Renewal Certificate or Cover Note where the
effective date of coverage under the Endorsement is before the Issuance date;
or
(b) When the period insurance is less than 60 days within THE PERIOD OF INSURANCE specified in the Policy, Endorsement,
Renewal Certificate or Cover Note
2. In the event any of the abovementioned premium is not paid in full to the company, registered broker or registered agent as
described above in the manner and within the time stipulated above (the “premium warranty period”), the cover under this Policy,
Endorsement, Renewal Certificate or Cover Note shall be deemed to have terminated from the expiry of the premium warranty
period and the Company shall be discharged from all liability therefrom but without prejudice to any liability incurred before that
date and the Company will be entitled to a pro-rata time on risk premium subject to a minimum of S$25/-
CONDITIONS
1. This Policy and the Schedule shall be read together as one contract and any word or expression to which a specific meaning has
been attached in any part of this Policy or of the Schedule shall bear such specific meaning wherever it may appear
2. Every notice or communication to be given or made under this policy shall be delivered in writing to the Company
3. The Insured shall take all reasonable steps to safeguard the Motor Vehicle from loss or damage and to maintain the Motor Vehicle
in efficient condition and the Company shall have at all times free and full access to examine the Motor Vehicle or any part thereof
or any driver or employee of the Insured. In the event of any accident or breakdown the Motor Vehicle shall not be left unattended
without proper precautions of being taken to prevent further loss or damage and if the Motor Vehicle be driven before the
necessary repairs are effected any extension of the damage or any further damage to the Motor Vehicle shall be excluded from the
scope of indemnity granted by this Policy
4. In the event of any occurrence which may give rise to a claim under this Policy the insured shall as soon as possible give notice
thereof to the Company with full particulars. Every letter claim will summons and process shall be notified or forwarded to the
Company immediately on receipt. Notice shall also be given to the Company immediately the Insured shall have knowledge of any
impending prosecution inquest fatal inquiry or offer of compensation in connection with any such occurrence. In case of theft or
other criminal act which may give rise to a claim under this Policy the Insured shall give immediate notice to the Police and co-
operate with the Company in securing the conviction of the offender
5. No admission offer promise or payment shall be made by or on behalf of the Insured without the written consent of the Company
which shall be entitled if it is so desires to take over and conduct in his name the defense or settlement of any claim or to prosecute
in his name for its own benefit any claim for indemnity or damages or otherwise and shall have full discretion in the conduct of any
proceedings and in the settlement of any claim and the Insured shall give all such information and assistance as the Company may
require
6. At any time after the happening of any event giving rise to a claim or a series of claims under Section II-1 (b) of this Policy the
Company may pay to the Insured the full amount of the Company’s liability under Section II-1 (b) and relinquish the conduct of any
defence settlement or proceedings and the Company shall not be responsible for any damage alleged to have been caused to the
Insured in consequence of any alleged action or omission of the Company in connection with such defence settlement of
proceedings or of the Company relinquishing such conduct nor shall the Company be liable for any costs or expenses whatsoever
incurred by the Insured or any claimant or other persons after the Company shall have relinquished such conduct
7. The company may cancel this Policy by sending seven days’ notice by registered letter to Insured at his last known address and in
such event will return to the Insured the premium paid less the pro-rata portion thereof for the period the Policy has been in force
or the Policy may be cancelled at any time by the insured on seven days’ notice and (provided no claim has arisen during the then
current Period of Insurance) the Insured shall be entitled to a return of premium less premium at the Company’s Short period rates
for the period of the Policy has been in force
8. If at the time any claim arises under this Policy there is any other insurance covering the same loss damage or liability the Company
shall not be liable to pay or contribute more than its rateable proportion of any loss damage compensation costs or expenses,
provided always that nothing in this Condition shall impose on the Company any liability from which but for this Condition it would
have been relieved under proviso (ii) Section II-2 of this Policy
9. All differences arising out of this Policy shall be referred to the decision of an Arbitrator to be appointed in writing by the parties in
difference or if they cannot agree upon a single Arbitrator to the decision of two Arbitrators one to be appointed in writing by each
of the parties within one calendar month after having been required in writing so to do either of the parties or in case the Arbitrators
do not agree of an Umpire appointed in writing by the Arbitrators before entering upon the reference. The Umpire shall sit with
the Arbitrators and preside at their meetings and making of an Award shall be a condition precedent to any right of action against
the Company. If the Company shall disclaim liability to the insured for any claim hereunder and such claim shall not within twelve
calendar months from the date of such disclaimer have been referred to arbitration under the provisions here in contained then
the claim shall for all purposes be deemed to have been abandoned and shall not thereafter be recoverable hereunder.
10. The due observance and fulfillment of the Terms of this Policy insofar as they relate to anything to be done or not to be done by
Insured and truth of the statements and answers in the proposal shall be conditions precedent to any liability of the Company to
make any payment under this Policy
Motor Vehicle : Any of the following including any vehicle (Mechanically propelled or otherwise) attached thereto
for the purpose of being towed:-
Any Motor Vehicle the property of the Policyholder or in their custody or control.
Limit of Liability:
Limit of the amount of the Company’s Liability under Section I – 3…………………..S$200.00
Limit of the amount of the Company’s Liability under Section II – 1 (a)
in respect of any one claim or a series of claims arising out of one event…………Unlimited
Limit of the amount of the Company’s Liability under Section II – 1 (b)
in respect of any claim or a series of claims arising out of one event……………….S$500,000.00
Geographical Area: West Malaysia, The Republic of Singapore and that part of Thailand within 50 miles of the border between Thailand
and West Malaysia
Legislation : Road Traffic Ordinance 1958 (Federation of Malaysia) Motor Vehicle (Third Party Risks & Compensation) Act (Cap.88 of
the Revised Edition) (Republic of Singapore) (the reference to Legislation under ”Avoidance of Certain Terms and Rights of Recovery”
is limited to Sections 78, 79 & 80 of the Federation Malaya Ordinance & Sections 6, 7, & 8 of the Singapore Act)
Authorised Driver
As described in the Certificate of Insurance
Limitations as to Use
As described in the Certificate of Insurance

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4.

▪ understand the need for Motor Fleet Insurance

1.4 In accordance with the Act:

2. TYPES OF PRIVATE MOTOR CAR INSURANCE COVERAGE

3. MOTOR INSURANCE DOCUMENTS

3.1 A completed proposal form is required when an individual seeks to purchase a

3.6 While there is no legal obligation of an insurer to issue a renewal notice, it is a

▪ Section I - Insurance On The Motor Car;

5. OTHER POLICY PROVISIONS

(a) Excess All Claims

(c) Elderly, Young And/Or Inexperienced Drivers Excess

5.8 These are described below:

The rate of discount for a private motor car is shown below:

Period Of Insurance Discount

(b) Other Discounts

C1. Geographical Area Of Coverage

C2. Jurisdiction Clause

C3. Transfer Of Policy

C4. Avoidance Of Certain Terms & Right Of Recovery

C5. Payment Before Cover Warranty

C6. Limitations As To Use

C7. Death Of The Insured

5.25 In the event of death of the insured, this policy covers:

7. MOTOR CLAIMS FRAMEWORK (MCF)

A. Key Points Of The MCF

7.3 The motorist should exchange particulars of involved parties including:

7.4 The motorist should take note of the vehicle numbers.

C. Consequences For Failure To Report An Accident To The Insurer

D. How Do Motorists Benefit From The MCF?

7.17 There are no fees or charges involved in the reporting process.

8. COMMERCIAL MOTOR VEHICLE INSURANCE

B. The Need For Commercial Motor Vehicle Insurance

8.2 Commercial Motor Vehicle Insurance is used by businesses to insure their

C1. Section I – Insurance On The Motor Vehicle

C2. Section II – Liability To Third Parties

C3. Section III – Towing Disabled Vehicles

D. Policy Provisions & Conditions

D1. No Claim Discount (NCD)

Period Of Insurance Discount

The preceding year 10%

8.16 In addition, the following extensions are also offered:

9. MOTOR FLEET INSURANCE

A. What Is Motor Fleet Insurance?

A1. Fleet Rating

Figure 4.1: Fleet Rating Method

Any Outstanding Losses

Step 2: Determine the “vehicle year”.

Step 3: Risk Assessment by Underwriter:

Total Losses Over The Past Three Years

Example 4.1 Application Of The Fleet Rating Method

Bus No. Registration Vehicle Remarks

PA 4321C 1 Jan 2020 3.00

S$400,000/ 16= S$25,000 per vehicle year.

As mentioned above, it is also necessary to take into account such factors as

If there is no purchase of new vehicles and no sale of current vehicles in

B. The Need For Motor Fleet Insurance

10. MOTOR TRADE INSURANCE

A. What Is Motor Trade Insurance?

B. The Need For Motor Trade Insurance

C. Motor Trade (Road Risks) Insurance

C1. Scope of Cover

is responsible, while the vehicles are:

10.4 The policy consists of only two main insurance sections:

The whole of Section I is not operative under a “Third-Party Only” cover.