Normal market rates for old cars' motor insurance

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Normal market rates for old cars' motor insurance

Postby admin » Tue May 03, 2011 12:24 pm

PETALING JAYA: Motorists owning private vehicles that are more than 10 years old will be charged normal market premium rates for their motor insurance, under a new Bank Negara measure effective immediately.

Insurance companies previously charged owners of such cars, grouped as "displaced" or deemed high-risk, between 200% and 300% above the normal rates.

"Those with displaced vehicles (which are mainly private vehicles exceeding 10 years old and motorcycles) that are currently underwritten by the Malaysian Motor Insurance Pool will no longer be subjected to the loading imposed on high risk vehicles," said a Bank Negara statement Tuesday.

It added that these vehicles will only be required to undergo annual roadworthiness checks at Puspakom to determine if they were high-risk.

The prior practice used a vehicle's age on the road as the yardstick to categorise its insurance risk, which in turns affected its premium rate.

Bank Negara also said insurers were now prohibited from compelling their customers to purchase non-motor products for the sale of motor insurance.

This included the purchase of personal insurance as a pre-requisite or complementary to the purchase of car insurance.

Bank Negara added that the immediate measures undertaken would ensure that all vehicle owners had access to motor insurance protection while transitioning to the New Motor Cover Framework.

Read the full article:
http://thestar.com.my/news/story.asp?fi ... sec=nation
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Old car owners relieved by new ruling

Postby admin » Thu May 05, 2011 6:57 am

KUALA LUMPUR: The decision by Bank Negara to allow owners of cars of more than 10 years to insure their vehicles with all insurance companies at normal rates was welcomed by the Malaysian Automotive Association (MAA).

Previously, old cars were only covered by the Malaysian Motor Insurance Pool (MMIP) which charged higher premiums.

MAA president Datuk Aishah Ahmad said owners of older cars had been raising this issue for a long time.

"They say their car is in good condition, but they still have to pay so much just to have their vehicles on the road."

MMIP is an insurance pool that is run collectively by several insurance companies under the orders of the regulators.

Old car owners have for years argued that their vehicles were not dangerous because of frequent servicing and checks on brakes and tyres. They claimed that they should not be penalised for driving old cars.

This prompted Bank Negara to allow owners of old cars to insure their cars at normal rates while those with cars that have been rejected by insurance companies because of the high risk involved will undergo road worthiness checks at Puspakom.

It is learnt that 100,000 cars out of 300,000 vehicles are categorised as high risk.

An industry source said old car owners had been paying up to three times the normal insurance rates for years.

"If the normal rate is RM70 to RM80, these people pay RM250 to RM300. The new move will finally end the arm-twisting method used by insurance companies."

The source said it was unfair to charge exorbitantly as not all old cars were dangerous on the road.

Malaysians Institute of Road Safety director-general Professor Dr Ahmad Farhan Sadullah said: "While we do not want old cars on the road because of the older technology used, the move will see high-risk cars being checked every year."

He said the high-risk cars might pass the Puspakom test for tyres and brakes and other safety aspects.

Read the full article:
http://www.nst.com.my/articles/07cars/Article/
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PIAM: No more loading fees for displaced vehicles

Postby admin » Thu May 05, 2011 6:58 am

PETALING JAYA: The new ruling on the insurance coverage for vehicles 10 years and older will take effect from next week, allowing owners to buy motor insurance at normal market rates through the Malaysian Motor Insurance Pool (MMIP).

General Insurance Association of Malaysia (PIAM) executive director Lim Chia Fook said PIAM members agreed with Bank Negara that the “displaced vehicles” would no longer need loading fees.

“Insurance companies should be ready to issue coverage for all vehicles irrespective of their age by next week,” he said, adding that insurers were preparing their branches with the necessary system to carry out the service.

“Displaced vehicles will no longer be required to undergo annual checks at Puspakom unless they are deemed to be high-risk,” Lim told The Star yesterday.

He added that time was needed for insurance companies to offer either their own motor cover or issue the cover on behalf of MMIP.

He was responding to a report in The Star yesterday that owners of displaced vehicles could now get insurance coverage without having to pay a loading of 200% to 300% provided they are roadworthy.

MMIP is a high-risk insurance pool that is run collectively by the insurance industry under orders from regulators.

The pool provides motor insurance to vehicle owners who have difficulty obtaining it from normal commercial insurance market.

PIAM is the umbrella body for general insurers in Malaysia.

Read the full article:
http://thestar.com.my/news/story.asp?fi ... sec=nation
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Normal loading up to 150% still applies

Postby admin » Fri May 06, 2011 2:47 am

PETALING JAYA: All motor vehicles, regardless of their age, will be charged the normal market premium including permissible loading of up to 150% if they are not deemed as high risk.

A Bank Negara spokesman said that owners of vehicles exceeding 10 years of age, which are also known as “displaced vehicles” in insurance terms, will no longer be subjected to loading applicable to high risk vehicles.

“We have come to an agreement with the Malaysian Motor Insurance Pool (MMIP) to set its loading within a certain range so that owners of displaced vehicles will not be excessively charged,” the official said.

Prior to the ruling announced on Tuesday, MMIP, as the insurer of last resort, was permitted to apply higher loading on owners of these vehicles. About 270,044 vehicles were categorised as displaced vehicles last year.

The move, which was announced by Bank Negara on Tuesday, came as an immediate measure to ensure that all motorists had access to motor insurance cover at a reasonable premium.

Bank Negara had also prohibited insurers from compelling customers from buying non-motor products for the sale of motor insurance.

The spokesman was clarifying a report in The Star yesterday which inadvertently named the General Insurance Association of Malaysia (PIAM) executive director Lim Chia Fook as saying that PIAM members agreed with Bank Negara that displaced vehicles would no longer need loading.

Read the full article:
http://thestar.com.my/news/story.asp?fi ... sec=nation
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Insurance directive will help motorists

Postby admin » Tue May 17, 2011 10:45 am

I REFER to news reports on Bank Negara’s directive to insurance companies to charge normal market premium rates for motor insurance (old private vehicles), which is to take effect immediately.

In recent years we have terms like “loading”, “excess”, “age loading” etc. These are terms used by the industry so that they can charge higher premium rates to motorists. And eventually we have cases of old private vehicles paying higher premium.

Insurers were also compelling their customers to purchase non-motor products for the sale of motor insurance e.g personal accident coverage.

Private vehicles that are more than 20 years old are categorised as “reject cases”, in simple word no insurance companies would want to cover them with a comprehensive policy.

If that was the case how on earth did they renew the “road tax”?

That could be the reason of many cases of cars without valid motor insurance and road tax on the road.

This is a classic case of the poor subsidising the rich or only the rich should be allowed to own vehicles.

Read the full article:
http://thestar.com.my/news/story.asp?fi ... &sec=focus
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