The new year is coming. The year 2024 is anticipated to be full of challenges and uncertainties. The most noticeable aspect is the expected continuous rise in the cost of living. Among the expenses that most of us need to bear is the premium for motor insurance. Opting for a policy that only covers third parties may seem like a cost-effective choice, potentially reducing premiums. However, this is viewed as highly risky and unsuitable for vehicle owners aged five years and below.
In 2016, Bank Negara Malaysia introduced the liberalization of motor insurance tariffs for comprehensive policies. This initiative aimed to encourage motor insurance providers to offer more innovative products to the Malaysian population, enhancing competitiveness while ensuring sustainable protection for consumers. Typically, consumers obtain motor insurance coverage for six or twelve months. However, the liberalization of motor insurance has prompted industry players to offer protection based on mileage. In simple terms, this product aligns with the mileage of the user, with lower mileage resulting in lower motor insurance costs.
A survey on motor insurance industry websites revealed that this product allows users to achieve savings ranging from 20% to 55% compared to existing comprehensive motor insurance products. Moreover, some motor insurance providers offer additional discounts on top of these savings. Users are also eligible to receive benefits if they do not make any claims during the coverage period. This product is available online on motor insurance industry websites, making it accessible to all residents in the country with smartphones and high-speed internet access. Additionally, the product is supported by an efficient and reliable payment system.
Although this product entered the market as early as 2021, an initial review found that awareness among motor vehicle owners is still relatively low. Many still adhere to traditional methods when purchasing their motor insurance. Consumers, especially households with more than one vehicle and retirees with low mileage, should take full advantage of this product. Users need to take proactive measures for their motor insurance needs, aligning with the spirit of the motor insurance liberalization initiative, which emphasizes the importance of reviewing the motor insurance purchasing process. This is expected to result in savings on motor insurance premiums. In line with the New Year's spirit, consumers should choose motor insurance products that suit their risk profiles and lifestyles.
