Guide To Buy The Best Car Insurance

Importance of Car Insurance

Having car insurance is important for the future good. Through car insurance coverage, a car owner will not feel overburdened if something happens to themselves or the car, later. At least the cost will be covered by the insurance company which indirectly lessens the burden of the owner.

Things you must know about Roadtax

Roadtax is compulsory - The Road Transport Department (JPJ) requires all vehicle owners to have a valid MVL which is also called as roadtax in order for vehicles to be used on the road.

Insurance is required to renew roadtax - A vehicle owner must renew the insurance and roadtax before it reaches its expiry date.

Vehicle owners are encouraged to renew motor and car insurance & roadtax within 2 months before the expiry date.

Types of Car Insurance Coverage

Comprehensive Car Insurance

Comprehensive car insurance is also known as first party insurance. It provides the most comprehensive protection. You will be covered for accidents, fire and theft. The insurer will also cover (pay the cost) if an accident happened to your car and the party you hit. This policy is suitable for car below 10 years old.

Third party, fire, and theft Car Insurance

This car insurance type provides coverage to your own vehicle if your car gets caught in fire, or gets stolen. If an accident happened (and you’re at fault), you will need to repair the car with your own money while the car you hit will be covered by your car insurance company.

Third party Car Insurance

This is the most basic type of car insurance. It only covers the third party involved in the car accident. No protection will be provided in the event of an accident (alone), theft or fire. Third party car insurance is subject to insurance companies’ approval.

Sum Insured of Car Insurance Coverage

Sum insured is the maximum amount a car can be insured according to the current market value. Click here for your reference.

The sum insured of car insurance can be determined by two different values:

Agreed value - Agreed value is the amount which has been agreed both by the car owner and insurance provider based on the car’s model and year.

Example: If the amount insured is RM35,000 and an accident occured, the car insurance company will give full compensation of RM35,000.

Market value - To put it in the simplest words, market value is defined as how much your car is worth before the damage occurs.

Example: If the amount insured for the car was RM35,000 but the market value for the car during the accident drops to RM30,000, the car insurance company will pay compensation depending on the market value of RM30,000.

No Claim Discount (NCD)

NCD is the discount given to you if no claim has been made under your policy with the current insurance company during the year. The rate of your NCDs will increase if there is no claim made by you in the following year.

Rates for cars vary as below:

NCDs rate for car:

However, if you have earned 55% NCD and eventually you made a claim during that year, your NCD rate will be back to 0% the following year.