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Kuala Lumpur, 6 February 2014 – The General Insurance Association of Malaysia (PIAM) wishes to clarify that the gradual premium adjustment under the new motor cover framework had been introduced in 2012. The new motor cover framework has a two prong strategy, i.e. to enhance efficiency in the provision of motor cover by the industry with a gradual price adjustment that will ensure that public is able to purchase motor insurance at affordable premiums.
Under the framework, premium adjustments take effect from 1 January 2012 over a period of four years. This year effective 15 February represents the third round of adjustments on Motor tariff premium rates. The adjustments will be small and implemented gradually in stages. In respect of Third Party cover, motorcycles of 110cc for example will experience a premium increase of between RM1.00 – RM3.50 per year only (a maximum of 30 sen per month) over the next four years. For a private car of 1,400 cc, the premium adjustment will be between RM6.00 – RM34.00 per year (a maximum of RM2.80 per month) over the same period. For express buses, the impact of the premium adjustment on the passengers would be minimal at less than 10 sen per passenger per trip.
Unlike previous years, there is no premium adjustment for the commercial goods carrying vehicles, taxis and hire cars (chauffeur driven) during this round of adjustment.
Meanwhile there are other classes of vehicles, such as school bus, factory bus, stage bus and tourist bus as well as hire cars (hirer driving), whose premiums have not been adjusted at all. This was to reflect their relatively better overall claims experience.
The new motor cover framework is a positive step towards promoting a liberalised insurance sector with further measures taken to improve the motor insurance and claims settlement processes. To enhance the claims settlement processes, various measures have been adopted by insurers and one of it is the introduction of the Accident Assist Call Centre (AACC) to provide emergency assistance to policyholders involved in road accidents. The 24-hour hotline 1300-22-11-88 also offers accident towing services and attends to claims enquiries.
The Association advises policy owners who wish to obtain clarification on how the new motor insurance framework will impact them to direct enquiries to their respective insurance company for further assistance.
About the General Insurance Association of Malaysia (PIAM)
PIAM is the national trade association of all licensed direct and reinsurance companies for general insurance in Malaysia. Currently, PIAM has 29 member companies.