FIRE INSURANCE

Long Term Fire Insurance
The Fire Sub-committee has reviewed and proposed the introduction of a Long Term Fire Insurance (LTFI) product in the Fire Tariff to allow conventional insurers to underwrite this type of insurance under specified conditions for residential properties. The proposed LTFI was submitted to BNM in the third quarter of 2009 and is currently pending consideration.

Review of Fire Tariff
The Fire Sub-committee is currently undertaking a review of the Fire Tariff, representing the fifth review of the Tariff since the last review done in 2004. Apart from the review of the Tariff rates, the Fire Subcommittee will also be examining those areas of the tariffs and measures to be taken to prepare market players for the eventual de-tariffed environment.

In this regard, the Fire Sub-committee conducted a brainstorming session in October 2009 whereby a road map for the conduct of fire insurance business in a liberalized environment has been formulated as a guide for the Fire Sub-committee to develop programs and initiatives in preparation for the move towards a de-tariffed market. Insurers' preparedness, increasing flexibility in underwriting fire business and public education have been identified as key areas requiring attention in the carrying out the de-tariff exercise.

Flood Extension Cover
Under the current provision of the Fire Tariff, insuring flood cover based on an elected sub-limit is prohibited as this would be considered as a first loss cover. The Fire Sub-committee has allowed an exception to the current provision for insurance of flood cover only based on selected floor(s) of a building provided the full sums insured for the floor(s) with and without the flood cover are provided and stated explicitly in the policy schedule.

NON-TARIFF

Enhancement of Information/Data Submission to ISM
The Non-Tariff Sub-committee is enhancing specifications for information and data submissions to ISM in respect of the following classes of business to ensure these are comprehensive and reliable for use by member companies especially in a de-tariffed environment:-

1. Medical & Health Insurance
   
2. Marine
   
3. General Accident, Engineering and Bond
   
4. Personal Accident
   

Plain Language Reference Policy Wordings
A Working Group has been formed for the purpose of drafting plain language policy wordings for the more common non-tariff classes as follows for reference by the industry:-

1. Money
   
2. Burglary
   
3. All Risks
   
4. Fidelity Guarantee
   
5. Plate Glass
   
6. Electronic Equipment
   
7. Equipment
   
8. Medical
   
9. Marine
   
10. Personal Accident
    

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