Gradual Revision Of Motor Tariff Premium From Jan 16

KUALA LUMPUR, Jan 6 (Bernama) -- The gradual revision in the motor tariff premium rates will be implemented effective Jan 16, 2012, says Bank Negara Malaysia (BNM).

In a statement today, BNM said the revision would be the first to be undertaken after the non-revision for over 30 years.

The central bank said the premium adjustment was in small quantum and to be implemented over a period of four years.

For third-party cover, motorcycles of 110cc will experience a premium increase of between RM1-RM3.50 per year only (a maximum of 30 sen a month) over the next four years.

For a private car of 1,400cc, the premium adjustment will be between RM6-RM34 per year (a maximum of RM2.80 a month) over the same period.

For commercial vehicles such as outstation taxis and buses, the impact of the premium adjustment on the passengers will be minimal, at less than 10 sen per passenger per trip.

BNM gave assurance that the implication on the public and businesses will be marginal.

According to BNM, the adjustment in the motor tariff premium rates will be reviewed periodically to ensure that the adjusted premium rates continue to be reflective of the claims experience.

The revision of tariff is part of the New Motor Cover Framework in addressing the structural issues within the motor insurance and takaful sector.

The framework will pave the way for the detariffing of motor insurance premiums in 2016 in which premium rates will be further differentiated in accordance to the risk profile of individual vehicles and fairer to vehicle owners as those with good claims experience would enjoy much better premium rates than those with higher risk profile, it said.

BNM had previously said that the tariffs which have not been revised for more than 30 years had been a major source of difficulties faced by the public in recent years.

While the premiums had not been adjusted, there had been significant increases in the level of car ownership to about 19 million to date, accident rate and claims, it said.

BNM had said the framework would also involve immediate implementation of critical measures to enhance efficiency in claims settlement.

The enhancements will significantly reduce the average claims settlement period to six to 18 months from the present one to five years.

To ensure that the public is aware and able to benefit from the framework, particularly on the enhancements to the motor claims settlement process, BNM and the insurance industry will continue to provide information to the public on motor insurance issues through consumer awareness and outreach programmes currently in place.

BNM said those with queries relating to the framework may contact the central bank at TELELINK : 1-300-88-5465 or visit www.insuranceinfo.com.my.

Enquiries can also be forwarded to either Persatuan Insurans Am Malaysia (PIAM) or individual insurers, it said.

-- BERNAMA

Source : http://finance.bernama.com/news.php?id=638310