The Dangers of Renting an Illegal Car in Singapore

In Singapore, rental of private cars through a car rental company is illegal.

According to Land Transport Authority (LTA), “private car owners are not allowed to rent out their cars through rental companies as it is illegal for both the car owner and the company to allow a private car to be used without proper insurance coverage”.

However, non-car owners may choose to hire a private vehicle if they want to through the Private Car Rental Scheme.

For Private Car Rental Scheme, private car owners are only allowed to rent out their cars from 7 pm on Fridays to 7 am on Mondays & from 7 pm on the eve of public holidays to 7 am on the first following working day.

Under the Private Car Rental Scheme, the car owners are responsible for providing adequate insurance coverage for the period of the rental. Which means that additional insurance for car rental must be purchase during this period.

What are the penalties of driving or renting out an illegal rental car?

1.) $1,000 Fine (Maximum Penalty)
2.) Imprisonment of not more than three months.
3.) Risk of a driving ban up to 12 months.
4.) Unlimited liability claims as you are not covered by any insurance.

How to identify legal rental cars in Singapore?

Road Tax For Car RentalA road tax disc printed “MOTORCAR” is a legal rental car registered with LTA.
Road Tax For Private Passenger VehicleA road tax disc printed “PASSENGER(PRIVATE)” is only meant for private use only.
You can easily identify the difference between legal and illegal rental vehicles by just looking at the road tax disc. A legal rental vehicle will bear a print “MOTORCAR”, whereas a private passenger car will show “PASSENGER (PRIVATE)”. Please beware of illegal rental vehicles to avoid any unwanted risks, fines, and claims.

At Ace Drive, all our cars are converted into legal rental vehicles by LTA (Land Transport Authority) with full comprehensive insurance coverage. So you are always assured that you only get legal rental cars from us.

Related news & forum threads about illegal car rentals

“Private Car Rental Offences On The Rise

Currently, when a private car is hired out without adequate insurance coverage, offenders may be fined up to S$1,000, jailed for up to three months or both.

Offenders may also be disqualified from holding a driving licence for a minimum period of one year.

Source: Channel News Asia, Dated 29 March 2013

“Rental Company Insists That The Car Hirer Owes It $67,000

A whopping $67,000, to be coughed up within a week was the ultimatum handed to Mr Rong by a car rental firm after he crashed a rented Honda Civic Car. Normally, the hirer should only be liable to pay the excess amount of the insurance, which ranges from $2,000 – $10,000, depending on the car and policy. However, the car rental company told the hirer that they will not allow them to claim insurance and they have to bear the cost of the damages themselves.

Source: Asia One Motoring, Dated 17 Oct 2012

“Fined $500 For Renting Out a Private Car”

A guy named Lawrence was caught when a hirer who took his car from the rental company was stopped by a Land Transport Authority officer. As a consequence for renting out his car illegally, he had to pay a fine of $500 and was disqualified from driving for a year.

Source: Asia One Motoring, Dated 28 Feb 2009

“Car Went Missing – Insurance Company Said That Her Car Is Not Covered By Her Insurance”

A woman who wants to be known only as Ms Lim, leased one of her cars to a car rental company for about $800 a month. She did not know that this is illegal, thus, by the time that her car went missing in Johor Baru, she got into a mess – SHE WAS NOT COVERED BY HER INSURANCE.

Source: Asia One Motoring, Dated 20 Jan 2009

Disclaimer: All sources are from the above mentioned. The stories are for guidance and reference purposes only, no copyright infringement is intended.