PIAM, MTA support further liberalization of motor vehicle insurance – add digital claim solutions
In a joint press release, it was announced that all 23 member companies of the General Insurance Association of Malaysia (PIAM) and four takaful joint member companies of the Takaful Association Malaysia (MTA) pledged their support. a gradual and orderly transition to market-based pricing as well as providing higher quality of service as part of phase two of the motorcycle and fire tariff liberalization.
The phased liberalization of engine and fire tariffs is announced by Bank Negara Malaysia (BNM) in 2016, with phase one beginning July 1 of that year. The industry was then allowed to offer new products and optional add-ons, with examples of post-flood add-ons, lost car key replacements, and other add-ons.
In phase two, which begins one year later from 1 July 2017, motor vehicle premiums are no longer determined on a flat rate basis, but on risk-based rating system.
As a result, Takaful insurers and operators can now set prices based on various risk factors such as location of residence, vehicle make and model, vehicle usage, occupation of the vehicle owner, claim history, gender and age. The advantage is greater competition in the industry when consumers can shop around at competitive prices and the insurance that best meets their insurance needs –
“With the effect of phase two, all licensed conventional insurers and Takaful operators in general will ensure that basic protection remains accessible and affordable. On top of that, phase two involves implementing end-to-end digital claims solutions to deliver a seamless experience for consumers and maintain ongoing access to price engine protection. affordable prices in the future,” PIAM and MTA stated in a joint statement.
