Persatuan Insurans Am Malaysia - Annual Report Details

Current Year NCD Relief Extension
With effect from 16 April 2007, qualified motor policyholders having comprehensive private car policies can purchase an extension to their policies to include cover for compensation for loss of “No Claim Discount”(NCD). The benefit from this extension is in the form of a “one-off” payment of NCD that is ‘lost’ due to a claim.

The compensation will be based on the NCD entitlement on the current period of insurance. This extension will assist policyholders to mitigate the cost of motor insurance at renewal in the event that they lose their NCD entitlement.

Endorsement 89 - Breakage of Glass in Windscreen, Window or Sunroof
To take advantage of new windscreen repair technology and in view of its cost benefit, motor vehicle owners will now have an option to repair minor damage to their windscreen as an alternative to total windscreen replacement. The sum insured of the windscreen will be reduced by the cost of the repairs only but will otherwise remain in force or, if required, may be reinstated with an affordable additional premium.

ISM NCD Database
ISM Insurance Services Malaysia Berhad (ISM) has set up the ISM NCD Database for on-line confirmation of No Claim Discount entitlements between insurers. The key objective of the database is to enable the exchange of information on the NCD status of motor policyholders among member companies more efficiently via automation, reduce paper-work and free insurance company staff for other duties.

The Database will be implemented on a parallel run basis with effect from 1 March 2007 and the use of the Database will become an industry standard for all members with effect from 1 June 2007.

Constructive Total Loss (Beyond Economic Repair)
In order to remove confusion and address complaints arising from this confusion raised by the public to the Police and JPJ about the reappearance of “Constructive Total Loss” vehicles on the road, the industry has agreed that the term “Constructive Total Loss” be replaced with the term “Beyond Economic Repair (BER)”.

Insurers have also been encouraged to adopt best practices which will involve having repaired BER vehicles sent to PUSPAKOM for post-repair inspections to assess the quality of repairs and roadworthiness of the repaired vehicles.

Amendments to Motor Policies
To further clarify the Motor policy wordings, changes were made to the definition of “Your Vehicle” which now clearly expresses that the vehicle insured is with its standard factory-fitted accessories and any other additional accessories as described in the policy schedule. This was to avoid any misunderstanding during the payment of claims especially involving vehicles which had been extensively modified without notifying the insurer.

Application of Betterment
The Scale of Betterment and its rules for application was incorporated in the respective Motor Policies for Private Cars, Commercial Vehicles/Motor Trade (Road Risks) and Motorcycles. This measure was necessary as there was lack of information and misunderstanding of the application of betterment under the principle of indemnity by claimants when betterment was applied by insurers.

PIAM Approved Repairers Scheme (PARS)
The objective of the PIAM Approved Repairers Scheme (PARS) which was introduced in 1983 was to enhance the standard of service, quality and professionalism of workshops involved in the repair of accident vehicles. The scheme currently operates nationwide. For repairers to be included in the PARS they have to submit applications to the Association for inclusion in the scheme and they must satisfy the minimum criteria in terms of facilities available in their workshops, equipment and experienced manpower. The Association also engages adjusters to conduct inspections on these workshops to ensure that the infrastructure of the workshops as required under the criteria is met.

The benefits of using repairers under the PARS for policyholders when conducting repairs to their damaged vehicles are that the workshops will give a warranty period of 6 months on workmanship on the repaired vehicle, assurance that the workshops have been approved by PIAM and have met the benchmarks set and policyholders are able to refer their grievances for unsatisfactory services to PIAM.

The PARS Working Group is currently conducting a comprehensive review of the current PARS requirements which will improve further the industry's ability to monitor and upgrade the role and functions of Approved Repairers under the scheme.

The total number of workshops approved as at 31st December 2006 was 805 as follows:-

KUALA LUMPUR	118	NEGERI SEMBILAN	32
SELANGOR	201	PAHANG	41
PULAU PINANG	50	KELANTAN	16
SARAWAK	56	TERENGGANU	18
JOHOR	101	PERLIS	3
PERAK	62	KEDAH	38
MELAKA	17	SABAH	52
TOTAL		805