We all looked forward to the news of the liberalisation of the motor insurance premium over three years ago. It was led to believe that ultimately, our insurance premiums would be lower after taking into account more parameters and building an individual risk profile.
Bank Negara Malaysia (BNM) began the move to liberalise the motor insurance premium in July 2017 with the idea of inculcating good driving behaviour plus rewarding lower-risk users. Fast forward to 2021, the General Insurance Association of Malaysia (or PIAM in the national language) in a statement clarified that while the gradual removal of requirements under motor tariff has begun, the pricing continues to be regulated by the industry regulator.
“It is important to note that PIAM is not involved in the pricing decisions of its members. Going forward, the industry eagerly anticipates further liberalisation and looks forward to working with BNM on the eventual opening up of the motor market,” PIAM said.
PIAM, which represent 26 members companies, said its members were allowed to introduce new products, but the pricing is still capped to a 10% variation (cheaper or pricier) compared to the tariffs set in 2016.
This was done to soften the impact of any sudden or significant changes in premium on consumers.
While it is true that different insurance and takaful providers offer different rates and coverage, yours truly didn’t find any significant savings changing from his current motor insurance provider, hence decided to continue for the third successive year.
PIAM also said the full liberalisation will lead to fairer pricing that will benefit safe drivers and lead to more product innovation, technologically-driven consumer solutions and a better overall consumer experience.
On the subject of motor insurance, remember to carry along your renewed e-cover note in your vehicle, as road tax (or LKM in JPJ lingo) renewals are not encouraged to reduce crowding and congestions at JPJ branches. Poslaju has temporarily halted road tax renewals at their physical outlets until March 31st.
Do not peel off or remove the expired road tax too, as driving without a road tax is a punishable offence, as reported by Harian Metro.
The Ministry of Transport (MOT) yesterday announced an extension to the exemption period for road tax renewals until May 31st 2021.