THE Government will speed up the process of coming up with a mechanism to provide third party insurance coverage, especially for vehicles aged 10 years and above.
Deputy Finance Minister Datuk Donald Lim said the Government was aware of the difficulties faced by some vehicle owners in obtaining motor insurance.
“Bank Negara, together with the ministry, is formulating a suitable mechanism to ensure that the rakyat has access to motor insurance coverage at affordable prices.
“Discussions were held with various agencies and the insurance industry between August and September to obtain their support for initiatives to improve effectiveness and transparency in motor insurance claims. We will speed up the process,” he said.
Lim told Salahuddin Ayub (PAS-Kubang Kerian) that consumer groups, transportation organisations, insurance firms and the Bar Council would be consulted before the proposed mechanism was presented to the Government early next year.
He said insurance firms and takaful operators were now more cautious about offering motor insurance, especially for high-risk vehicles such as those aged above 10 years.
“This is due to spiralling third party death and injury protection claims and the insurance companies’ limited financial means.
“For example, industry statistics last year showed that the average claim for private vehicles older than 10 years was RM7,310 while for those below 10 years, it was RM6,217,” said Lim.
Similarly, he said the average claim for vehicles transporting goods aged 10 years above was RM8,639, compared to RM7,351 for newer models.
Lim also said the insurance industry had collaborated to offer coverage via the Malaysian Motor Insurance Pool to ensure the public had better access to the service.
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