All you want to know about... MOTOR INSURANCE

INSURABLE INTEREST

Make sure that you buy cover as soon as you purchase a vehicle. If you buy a used car, you should protect your interest by purchasing a motor insurance cover as the cover of the previous owner is no longer valid even if legal ownership transfer has not been effected with Jabatan Pengangkutan Jalan (JPJ).

INSURED VALUE/SUM INSURED

Ensure your vehicle is adequately insured.

NEW VEHICLE: Sum Insured = Purchase Price

OTHERS: Sum Insured = Market Value of vehicle when policy is bought

Under Insurance: if sum insured is less than the market value, you are deemed as self-insuring the difference. In the event of a loss, you will only be partially compensated.

Over-Insurance: if sum insured is higher than market value, maximum compensation is the market value of the vehicle. You cannot profit from a claim (principle of indemnity).

AVERAGE CLAUSE

It is applied when you suffer damage to your vehicle which is under-insured. Your claim will be reduced proportionately by the uninsured portion, e.g. if you have insured your vehicle up to 70% of the market value, the insurance company will only pay 70% of the total repair cost.

DISCLOSURE

Disclose all material facts, e.g. any previous accidents and modification to engines. If you fail to do so, your insurance company may refuse your claim or any claim made by a third party against you. In such cases, you are personally liable for those claims.

NO CLAIM DISCOUNT (NCD)

The premium payable may be reduced by your NCD entitlement. NCD is 'awarded' if no claim was made against your policy during the preceding 12 months of policy. Your NCD entitlement will depend on the class of your vehicle and number of years of continuous driving experience without any claim made against your insurance policy. You will lose your entire NCD entitlement once an own damage or a third party claim is made against your policy.

EXCESS

It is the amount of loss you have to bear while your insurance company will pay for the balance of your vehicle damage claim. If you have an 'excess' on your policy, you must pay the amount of the 'excess' direct to the repairer/workshop.

PAYMENT OF PREMIUM

• Premium must be made to the authorised agent/agency or to the insurance company directly before cover can be granted.

• With the full implementation of the JPJ e-INSURANS system with effect from 2 Jan 2005, physical cover notes are no longer issued. However, a statement containing details of your motor cover will be provided as confirmation of purchase of motor insurance.

• Through the JPJ eINSURANS, all information on insurance coverage will be channelled electronically by your agent/agency/insurance company to JPJ.

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