MOTOR INSURANCE

No-Fault Liability (NFL) Scheme
In August 2007, the Attorney General's Chambers issued a Preliminary Issue Paper proposing that a No Fault Liability Scheme (NFL) be introduced. The Association had actively participated in various discussions, public lectures, working groups and fact-finding sessions organised by the Attorney-General's Chambers on the proposal to introduce a NFL scheme for motor vehicle accident claims.

The Association also collaborated with BNM to organise a forum with experts from Australia, Japan and Thailand in December 2007 to share their experience in formulating and managing NFL schemes in their respective jurisdictions, to broaden the understanding of various stakeholders on the subject.

Presently the Association as well as other stakeholders are awaiting the full details of the NFL proposal from the AG's Chambers for a clear and thorough understanding of the proposed scheme's structure, mechanisms and funding options.

Speakers from Australia, Japan and Thailand with representatives from BNM and PIAM at the Forum on NFL in December, 2007

In the interim, the Association is looking at the following measures which it is of the view, will aid to reduce delays and backlogs of court cases:-

1. Pre-action protocols to facilitate settlement of claims
2. Comprehensive guidelines for assessment of damages to ensure uniformity of awards
3. Special courts for Motor Vehicle Accident (MVA) injury claims
4. Reducing the limitation period to 3 years from current 6 years
5. Examination of the contingency fee based approach by lawyers
6. Interest rate on Court Award

Amendment to Motor Policies

- Theft of Motorcycle
To further clarify the intention of the Motorcycle policy to deter fraud, changes were made to Clause (1) of Section A of the Policy to clearly express that loss of integral parts of a motorcycle (unless the vehicle is stolen at the same time) would not be payable.

- Requirement for Claims Notification
The general policy requirement for claim notifications to be made “as soon as possible” has been replaced with specific time frames in order to avoid disputes with claimants. The stipulated time-frames are as follows:-

1. Within seven (7) days if the insured is not physically disabled or hospitalized following the event
2. Within thirty (30) days or as soon as practicable if the insured is physically disabled and hospitalized as a result of the event
3. Other than the above a longer notification period may be allowed subject to specific justification and proof from the insured

PIAM Approved Repairers Scheme (PARS)
The total number of workshops approved as at 31^st December 2007 was 813 as follows:-

Following the introduction of the requirement for PARS applicants to be incorporated companies with minimum paid-up capital of RM50,000, all repairers under the scheme have met these requirements with effect from 1st January 2006. A comprehensive review on PARS has been completed and will be implemented in 2008.

Vehicle Theft Reduction Council of Malaysia Berhad (VTREC)
The Vehicle Theft Reduction Council of Malaysia Berhad (VTREC) was incorporated as a company limited by guarantee on 30^th April 2007. The main objectives of VTREC are:-

1. To bring about a reduction of motor vehicle theft at the national level
2. To facilitate cooperation between industry, Government and community stakeholders to implement the relevant recommendations of the Council
3. To develop and advocate proposals for change across Government and non-Government sectors for action necessary to reduce motor vehicle theft

The Board comprises of the following persons:-

Since its incorporation, the Council had convened two meetings in September and October 2007. The then Deputy IGP, Y. Bhg. Tan Sri Mohd Najib bin Abdul Aziz had graciously agreed to be appointed the first Chairman of the Council. His successor, YDH Dato' Ismail bin Haji Omar has been nominated by the Polis DiRaja Malaysia to replace him as a member of the Board following his retirement.

A concept paper was drawn up by PIAM and discussed at the second meeting of the Council, which addressed the following matters:-

• the proposed vision and mission of the Council
• the proposed values of the Council
• the proposed strategic goals for 2008 which refer to a short term plan (i.e. initiatives that could be undertaken by the respective stakeholders individually) and development collectively of long term initiatives (with comprehensive theft information exchange being one of the key initiatives)

Recovery of Stolen Vehicles From Overseas

With close co-operation from the Royal Malaysia Police Interpol, the Association has been successful in recoveries from overseas as follows:-

The Thai Custom has also returned 5 vehicles valued at about RM385,000 to the Malaysian Government, on August 7, 2007.

Online NCD Confirmation System
With the ISM NCD Database system, the industry implemented the mandatory online NCD confirmation between members starting 1^st June 2007 for all new motor insurance business. As at November 2007, ISM reported that the overall compliance rate is 85.3% for the industry.

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