Adjustments to motor premiums start Jan 16
THE gradual revision to motor insurance premiums under the New Motor Cover Framework will begin on January 16.
The is the first time motor insurance premiums are being revised after more than 30 years.
The adjustments are said to be marginal but the overall outcome will see those with a higher risk profile paying a bomb in their insurance premiums, while good drivers will be rewarded with lower rates, said Bank Negara Malaysia assistant governor Abu Hassan Alshari Yahaya.
Briefing the media here yesterday, he said the premium revision isin a small quantum and will be implemented gradually over four years.
"The implication on the members of the public and businesses will be marginal," he said, adding that premium adjustments will be smaller for categories of vehicles commonly used by the lower income group.
He said consumers can contact their respective insurers or agents for the exact quantum of the increase.
The new framework, first announced last March, is aimed prima-rily at addressing structural issues within the motor insurance sector.
It will pave the way for detariffing of motor insurance premiums in 2016, in which rates will be further differentiated in accordance to the risk profile of individual vehicles and be fairer to vehicle owners.
Abu Hassan said that the gradual premiums adjustment is to coincide with the improvements to the national transportation system expected in 2015, by when the public is anticipated to favour public transportation over their own vehicles.
Citing an example of the quantum of increase in premium, the assistant governor said for third-party cover, motorcyles of 110cc will see an increase of between RM1 and RM3.50 a year over the next four years, or a maximum of 30 sen a month.
For a private car of 1,400cc, the premium adjustment will be between RM6 and RM34 a year over the same period.
For commercial vehicles such as outstation taxis and buses, the impact of the premium adjustment on the passengers would be at less than 10 sen per passenger per trip.
Abu Hassan said the adjustments in motor insurance premiums will be reviewed periodically to ensure that they continue to be reflective of the claims history of the vehicle owners.
He noted that Malaysia has one of the highest numbers of registered vehicles in the world at 19 million, and highest rates of accidents and deaths from motor accidents in the region.
Over the last 30 years, accident rate and claims in Malaysia have risen significantly, along with costs in hospitalisation, medical expenses, vehicle repairs and spare parts, he added.
Since the announcement of the New Motor Cover Framework last March, five measures have been implemented while six more are expected to be completed by the first half of this year.
Abu Hassan said since the implementation of the new measures, the average claims settlement period has been reduced to about 400 days or 15 months compared to 600 days before.
The target, he said, is to reduce it to between six and 18 months, adding that "if we could achieve 18 months, we might tighten it further".
Source : New Straits Times
Date : 7 January 2012
Today’s Pick (09/01/12/005/696)
No comments:
Post a Comment