Friday May 6, 2011PETALING JAYA: All motor vehicles, regardless of their age, will be charged the normal market premium including permissible loading of up to 150% if they are not deemed as high risk.
A Bank Negara spokesman said that owners of vehicles exceeding 10 years of age, which are also known as “displaced vehicles” in insurance terms, will no longer be subjected to loading applicable to high risk vehicles.
“We have come to an agreement with the Malaysian Motor Insurance Pool (MMIP) to set its loading within a certain range so that owners of displaced vehicles will not be excessively charged,” the official said.
Prior to the ruling announced on Tuesday, MMIP, as the insurer of last resort, was permitted to apply higher loading on owners of these vehicles. About 270,044 vehicles were categorised as displaced vehicles last year.
The move, which was announced by Bank Negara on Tuesday, came as an immediate measure to ensure that all motorists had access to motor insurance cover at a reasonable premium.
Bank Negara had also prohibited insurers from compelling customers from buying non-motor products for the sale of motor insurance.
The spokesman was clarifying a report in The Star yesterday which inadvertently named the General Insurance Association of Malaysia (PIAM) executive director Lim Chia Fook as saying that PIAM members agreed with Bank Negara that displaced vehicles would no longer need loading.
What Lim said was: “All motor vehicles, irrespective of age, will be provided cover at normal market premium rates, including the permitted loading.”