Motor Motor Insurance De-Tariffication in Malaysia explained

 

Motor Insurance De-Tariffication

Motor Insurance De-Tariffication will be at your door in early of July 2017. How to explain De-Tariffication in easy way.  Right now and for the last 30 years Motor Insurance Premium is regulated by a tariff structure and controlled by Bank Negara.

Your premium is determined based on 2 main factors.

1. Current market value of your vehicle
2. Vehicle engine capacity.

The prices charged by insurance company are relatively the same. You can go to any insurance company and you will get the same price.

However starting 1st of July 2017 , the price structure will be totally different.There will be no price structure , you insurance premium will be determined by the risk factor.

Higher Risk = higher insurance premium
Lower risk = Lower insurance premium

The assumption of the risk factors will be determined by

Age
Gender
Type of Car
Occupation
Claim History
Usage of Car

IF you are an older guy , the insurance company will assume that you are in the lower risk group.The reason is old people drives slow compared to the young people. Possibly your premium will be cheaper.

Basically Insurance company will use big data that they have collected for the past 3-5 years to determine the risk factor.

If the data shown that Myvi cars aged more than 5 years have low claim history , than the premium for this category will be lower.

The best thing of De-Tariffication that you can shop around for cheaper premium. Different Insurance company has different assumption of risk factor.

I really think that big insurance companies will throw the price down the hill because they have the capability to absorb risk compared to the smaller company.

 

 

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Motor Motor Insurance De-Tariffication in Malaysia explained

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