COE, PARF, OMV. In Singapore, we use acronyms in an effort to make things less complicated. Because, let’s face it, buying a new or used car in Singapore is not for the faint hearted!
If you dream of owning a car but are baffled by all the acronyms, this is for you. Make your favourite drink, put your feet up, and let the trusty team at Budget Direct Insurance break it down for you.
PARF car
What is this acronym PARF? It stands for Preferential Additional Registration Fee (well you did ask…)
Definition - A car that is still using its original COE
Age - Less than 10 years old
Quick facts - Normally, a new car in Singapore comes with an Open Market Value (OMV). This takes into account the cost of production of the car, including purchase price, shipping, insurance and other incidental charges.
Link to check the OMV for your car
What about the money? If the vehicle is de-registered within 10 years of its first registration date, the registered owner can claim a (PARF) Rebate. Normally a percentage of the OMV. Hence, the term PARF car
Link to check your car’s PARF rebate
COE car
What is this acronym COE? It stands Certificate of Entitlement
Definition – A car whose COE has been renewed
Age – Over 10 years old
Quick facts - If you want to continue using a car after 10 years, you must renew the car’s COE. The cost will depend on the Prevailing Quota Premium (PQP).
Link to check your car’s PQP
What about the money? If you choose to renew a car’s COE, you will not be able to claim a PARF Rebate when the vehicle is de-registered. However, a COE rebate will be available to you.
Link to check your car’s COE rebate
We also recommend checking out this handy guide on how to renew your COE. You may also want to know what are the best cars for COE renewals.
Should I buy a COE or PARF car?
Here’s a table to help you decide:
How to make your decision
The car you buy will depend largely on your essential requirements, your lifestyle, the amount you drive, fuel efficiency and perhaps environmental concerns.
Scott Vance, founder of Trisuli Financial Advising says that when he was young, his dad would sit him down and have him split a piece of paper into two columns.
"The left would be positives, the right would be negatives. Then [he would] have me list as many as I could think of. He made me do this for financial decisions such as car-buying, enlisting in the Army and college choices," Vance says. "It is something I still do today. Recognizing the negatives of a choice and the potential positives has always forced me to weigh the good and bad and make a decision fully knowing the negatives that may happen." —US News, Money, July 2016
Wherever you go, whatever you do, it’s vital to have good car insurance.
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