Thursday, May 17, 2012

Few insurers here cover supercars

Source:     The Straits Times© Singapore Press Holdings Limited.
Author:     Leslie Kay Lim   

ONLY a handful of insurers here offer coverage for million-dollar supercars like Ferraris and Lamborghinis.

The insurance policies do not come cheap, with annual premiums for Ferraris, for instance, starting from as high as $30,000, said insurance brokers and importers of these high-end cars.

This is almost 30 times the premium for, say, a medium-sized Japanese family sedan. But the same procedures apply when claims are made, whether the car involved in an accident is a high-end or a run-of-the-mill car.

A check by The Straits Times yesterday showed that while AXA Insurance, Liberty Insurance and Chartis will accept such business, at least one major industry player - NTUC Income - does not.

'NTUC Income does not focus on the supercar segment of the market,' said its vice-president of branding and public relations Karen Yew, adding that the company prefers to focus on the needs of a mainstream market.

Dealers and parallel importers, such as Meridian Automobile, said that after owners have submitted a police report following an accident, insurers will typically assess the condition of the car and examine the evidence - to determine who is at fault - before paying out claims.

Provided the driver is not at fault, the insurer may have to foot the entire repair bill of his car although it can claim that amount from the other motorist. If the driver is at fault, the insurer is not liable for costs of repair but will have to pay the claims from the other motorist.

Mr Joey Lim, 45, owner of workshop Harmony Motors, said repair bills of supercars can escalate if certain components or spare parts have to be flown in.

Should the car be considered a total loss - meaning it is beyond repair or if the cost of doing so exceeds the current market value of the vehicle - it will often be replaced.

This may not be easy though for rare models like the one involved in the accident last Saturday that claimed three lives, including Chinese national Ma Chi, 31, who was behind the wheel of the rare Ferrari 599 GTO.

The high-end supercar that hit a ComfortDelGro taxi cost about $1.4 million. The Ferrari was sold only to a select few here as it had a limited production run. The Straits Times understands it was insured by AXA.

'It's impossible to find parts for a GTO in Singapore,' said vehicle sales executive Desmond Lim who works at parallel importer Executive Automobile, which sells around 10 Ferraris a year.

If a replacement car cannot be found, the insurer may opt to pay what it is worth in cash to the owner or, in the event that he is no longer alive, to his estate.

The Land Transport Authority said 17 new Ferraris were registered here as of March this year. In all, there were 4,149 Porsches, Maseratis, Ferraris, Lamborghinis and Aston Martins registered here last year, up from 3,376 the year before.


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