Sunday, November 28, 2010

PIAM (Persatuan Insurans Am Malaysia) ANNUAL REPORT 2009/2010

MOTOR INSURANCE

Submission of Information to Lembaga Hasil Dalam Negeri Malaysia (LHDNM) for "Declaration of Earnings"

Arising from the meeting between the representatives of the PIAM Claims Management Subcommittee, Task Force on Third Party Bodily Injury (TPBI) Claims Fraud and representatives of the Lembaga Hasil Dalam Negeri (LHDN), member companies have been advised that they can submit information on "Under-Declaration or Non- Declaration of Earnings" to LHDN either at the earliest stages of claims processing or during the process or at the conclusion of court hearings.

Although it has been decided that it would be left to the individual member companies' discretion to submit the relevant information to LHDN, the Association has strongly encouraged members to do so as this measure will act as a strong deterrent against malpractices and fraud against insurers.

ISM Automotive Business Intelligence (ISMABI) System
- Motor Vehicle Valuation
With effect from 29th September 2009, the ISM-ABI system was incorporated as an accepted reference standard for motor vehicle valuations under the Motor Tariff.

When the ISM-ABI standard is applied to a motor insurance policy, the policyholder and the insurer agree that reference to the ISM-ABI system would be used to determine the sum insured of the vehicle at the point of purchase or renewal of the motor insurance policy as well as form the basis for the quantum of settlement when processing claims.

ISM-NCD Database - NCD Online Integration
As an improvement to current efforts to facilitate no claim discount (NCD) verifications, it has been agreed that insurers and all other intermediaries who accept motor insurance cover must obtain confirmation from a centralized ISM-NCD database at point of sale. Industry players are in the process of synchronizing NCD data from their systems with that in the ISM database.

PIAM is working with ISM on the integration of systems for on-line NCD confirmation (i.e. connectivity of insurance company systems, agency systems and gateway provider systems to be on-line with the ISM database). Companies can connect directly to the ISM-NCD System or appoint a gateway provider to channel the transactions to and from ISM. The proposed time-line for full on-line integration with ISM-NCD Database at all points of sale has been set for 1st July 2010.

As an additional service to consumers, ISM has also made the NCD confirmation service available to the general public via internet or SMS inquiries.

Introduction of On-line Knock-for-Knock (KfK) System
A Working Group to Review the KfK Agreement has recommended that an on-line KfK system be developed to fully automate the KfK procedures to further expedite settlement of KfK claims between handling and claimant insurers. The Working Group will be discussing with service providers for development of the system and also looking into the necessary changes to the KfK Code of Procedures and Practices.

PIAM Approved Repairers Scheme (PARS)
The total number of approved workshops as at 31st December 2009 was 537. The breakdown by states were as follows:-

1.KUALA LUMPUR (WP)67
2.SELANGOR191
3.PULAU PINANG26
4.SARAWAK31
5.JOHOR59
6.PERAK40
7.NEGERI SEMBILAN24
8.MELAKA14
9.PAHANG22
10.KELANTAN9
11.TERENGGANU14
12.PERLIS2
13.KEDAH20
14.SABAH18
TOTAL537 

The PARS Working Group has been reviewing the PARS requirements to impose more stringent requirements and conditions on PARS applicants to further enhance and improve the service standards and quality of PARS Workshops. Pending the completion of the review by the working group to be completed by 1st April 2010, new applications were temporarily frozen.

Vehicle Theft
The Government has launched the Government Transformation Programme (GTP) Roadmap and 6 National Key Result Areas (NKRAs) initiatives on 28th January 2010.

One of the NKRA programmes on Reducing Crime is to reduce overall reported index crimes. The targets are to achieve at least a 5% reduction in overall reported index crime every year for the next three years.

PIAM was invited for preliminary discussions with the Crime Lab set up by Ministry of Home Affairs to look into crime reduction. PIAM has submitted recommendations on a Framework for Vehicle Anti- Theft Measures on Private Cars to BNM. The Ministry has invited BNM as a stakeholder in the Crime Reduction NKRA.

A 3-prong approach to address the theft situation was recommended involving the following:
  1. Introduction of Vehicle Security Rating Standards;
  2. Applying Underwriting Approaches to address vehicle theft; and
  3. Introduction of Incentive & Penalty Scheme for Vehicle Security Devices
Recovery of Stolen Vehicles from Overseas
With close co-operation from the Royal Malaysia Police Interpol and Singapore Police, the Association was able to assist members in the recovery of stolen vehicles from Singapore as follows:

Recovery DateCountryNo. of VehiclesEst. Total market Value/RM
15th May 2009Singapore302,273,460
30th November 2009Singapore261,300,000

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