Car insurance in Malaysia: All you need to know
“Yes! It’s time to get my car insurance!”, said no one ever. We get it. Not only are car insurance applications a hassle, it can cost a bit too. But no matter what kind of driver you are, there’s a chance your car could face damage at any time – be it an accidental bump, a major collision, or even a freak weather event flooding your car. If you’re a first-time car owner, here’s all you need to know to get up to speed.
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What is car insurance
In Malaysia, all car owners must have valid car insurance – it is illegal to not have any. You may think it is a hassle to get insurance every year, but if you are in an accident, you can save yourself a pretty penny. Everything from the repair costs to medical treatment can be partially or fully covered by insurance. Even if your car is irreparably damaged, the insurance provider might compensate you for the value of your car at the time of the accident.
However, not all insurance coverages are built equal and are determined by you and your provider. So let’s go through the general types of coverage.
Coverage types
- Third party insurance coverage This is the most basic type of car insurance and is also the cheapest. If you get this coverage and get into an accident, only the other car’s (third party) vehicle damage is covered. If you want to repair your own car, you have to pay it out of pocket.
- Third party fire and theft coverage With this insurance coverage, you still do not have financial coverage for your car. However, your car gets coverage for theft or fire.
- Comprehensive car insurance coverage This is the most comprehensive of all types of coverage and both your car and the third party’s car are covered.
| Third Party Coverage | Third party fire and theft coverage | Comprehensive car insurance coverage | |
|---|---|---|---|
| Third-Party Claims | |||
| Death & Injury | ✓ | ✓ | ✓ |
| Damage to Property | ✓ | ✓ | ✓ |
| Loss/Damage to Your vehicle | |||
| Fire | X | ✓ | ✓ |
| Theft | X | ✓ | ✓ |
| Accident | X | X | ✓ |
| Passenger death & Injury | X | X | X |
Read more: What to do after an accident?
Additional coverages
Car insurance is not total. Windshield and flood coverage for example are not often provided but are an additional premium that you have to pay for. But as they say, it’s better to be safe than sorry. Here are some add-ons most car owners consider:
Vehicle accessories
This premium covers any damage or theft of your multimedia player, aftermarket rims, and other items. To get this add-on, determine the value of the items that you want to insure and add that figure into the add-on. Do note that the maximum value that can be insured is determined by your insurance provider.
Compensation for assessed repair time (CART)
This is an extremely important coverage as you can get compensated for when your car is being repaired. In that time you might be inconvenienced by having to Grab or carpool. So don’t forget this one!
Note: This only applies to when your car is undergoing repairs. Not from the period of your accident to the collection of your car.
Additional drivers coverage
Car insurance is usually linked to the car owner. But surely family members can share a car? So what happens if another person is driving it? That’s where the additional driver coverage comes in. Your insurer will not pay out if an additional driver is not covered and subsequently gets into an accident. With this additional premium however, you can extend the insurance’s coverage onto another driver as if they were the owner of the policy.
All driver coverage
You can get the all-driver coverage to cover every authorised driver, which saves you the hassle of naming individual drivers.
Passenger liability cover
This premium financially protects you or your authorised driver from any legal liability for the death or bodily injury of a passenger due to negligent driving. This does not apply to your passengers if you are a taxi or Grab driver. Additionally, if you want to drive in Singapore, this premium is required.
Special perils
As spooky as the name sounds, the perils basically refer to natural disasters. Floods, typhoons, earthquakes, and other natural disasters. You don’t have to worry about your car being damaged by those torrential rains any more!
Read more: How to survive a flooded car
Strike, riot, and civil commotion
This additional coverage protects your car should a strike or protest pass through your area and your car is damaged. This, however, usually does not cover war, acts of terrorism, coups d’états, and other conflicts. While Malaysia is unlikely to have any sort of conflict (fingers crossed!), try staying up to date on the news and avoid areas where protests are expected to happen.
Windshield, windows & sunroof
Did you know these things are generally not covered by insurance? They come at a premium. So if any of these gets damaged for whatever reason, you will need to fork up a lot of money to replace them if you’re not covered! It’s a no-brainer – just get this add on!
What can void your insurance
Criminal activity
If you are committing a crime while driving your car and get into an accident, don’t expect your insurance to cover your damages. Sounds duh, but hey, better to clarify.
Driving drunk (or on any kinds of drugs)
While under the influence of alcohol, your hand-eye coordination regresses to that of an 8-year-old. Your provider may cover any medical bills if you get into a crash, but don’t expect them pay out third-party vehicle damage or to renew your insurance. Your driving licence may also be revoked, so a lack of insurance will be the least of your worries.
Insurance fraud
Fraud is when you try to lie to the provider to get more money. This ranges from including previous damages in your claim to intentionally damaging your car so you can make the claims. Once you are caught defrauding an insurance provider, you will likely have a hard time getting insurance without paying a lot of money.
Not reporting modifications
Vehicle modifications can increase the likelihood of making a claim, which is bad for an insurance provider. Some modifications may make a vehicle more susceptible to theft, while others improve a vehicle’s performance. So if your car gets stolen or has an accident because of these modifications, your insurance provider may choose to void the policy.
Things to take note of:
Deductibles or excess
Some insurance coverages have deductibles. This means you need to pay a certain amount of money before your provider starts paying for the things they promised to cover. For example, if your deductible is RM50, you will need to pay RM50 before the insurance provider will pay to repair whatever damages there are.
No Claim Discount (NCD)
If you have an insurance policy with a provider and did not claim your insurance, you are entitled to an NCD. So your next insurance premium will be lower than the previous year! This will continue until you hit the maximum discount or until you make a claim.
Read more: How to transfer NCD
And that is it! Not so hard now is it? Okay, you still have to go through a bunch of different insurance providers to find the right one for you. That is why you get your insurance from Carro and easily compare multiple policy providers and pay through a variety of methods! And if you’re looking for a new ride, simply check out our inventory of Carro Certified cars for the right car for you!
