Factors Affecting Premium Rates: What You Must Know

Factors Affecting Premium Rates: What You Must Know

With the detariffication of motor insurance back in 2017, each individual’s premium rate may no longer be the same, as insurance companies are now using the risk-based pricing method to calculate your premium. Find out the factors affecting your motor insurance premium.   Before 2017, Bank Negara Malaysia (BNM) was the one responsible for controlling the price of motor insurance premium. Insurance companies followed a tariff structure, where the factors affecting one’s premium include the following:

  • The vehicle’s current market value
  • The engine capacity (cc) of the vehicle
  • The vehicle’s age (vehicles older than 10 years old had higher premium rates)
  • Add-ons, for example, Personal Accident

Minor differences in pricing

Due to the same calculation method used across insurance companies, the premium rates were pretty much similar regardless of the company you chose to purchase insurance from. Even if there was a small difference in pricing, it could be because of:

  • Different add-ons (product or service) included in the policy
  • Loading conditions (whether a vehicle carries a higher risk)
  • The sum insured (a vehicle’s value may be viewed differently by different insurance companies)

What are the factors affecting premium? 

Post-detariffication, insurance companies are no longer required to follow the tariff structure set by BNM. Instead, premium rates for motor insurance are now based on several risk factors carried by an individual, which include the following:

  • How you use your car

Are you a suburban housewife who drives her car to run errands and fetch her kids to and from school? Chances are your premium rate may be lower as the risks you carry are fewer than those who commute daily to their office via highways, where the risk of road accidents is high.

  • The type of vehicle you drive

Vehicles equipped with intermediate to high-performing rear-engine models as well as sports-type vehicles have higher premium rates. This is because the repair cost is more expensive than average vehicles if an accident occurs.

  • Your age

The younger you are, the less experience you have in driving. This means your premium rate will be higher as you’re perceived to carry more risks, compared to drivers with years of driving experience.

  • Your gender

Female drivers tend to be more careful on the road, so they get to enjoy lower premium rates compared to their male counterparts.

  • Your driving record

If you have no history of getting speeding tickets, being involved in an accident, being slapped with summons because you didn’t follow the rules, or other traffic offences, chances are your premium rate will be lower.

  • Your claims history

Drivers who have a history of making claims indicate that they carry higher risks, which means they’ll get a more expensive premium rate.

  • The add-ons you choose

The more coverage and benefits you picked, the more expensive your premium rates will be. Typically, insurance policies that cover the driver, as well as the third-party, tend to cost more.

  • Where you live

If you live in a high-risk area where vandalism, theft, or accidents are common occurrences, your premium rates will be higher.

Simple tips to get affordable premium rates

Now that you know what factors are affecting the premium rates of your motor insurance, you can try to get more affordable rates by following these simple tips:

  • Have a budget in mind

Calculate your monthly expenses. See how much money you can set aside to purchase motor insurance and be able to pay every month.

  • Drive with good manners and keep a clean record

Avoid getting into a car accident by driving carefully and controlling your temper and ego (road rages are so common in Malaysia). Don’t drive too fast if you don’t want to get a speeding ticket. Don’t do any traffic violation to avoid being slapped with hefty fines. These are the simple ways you can keep a clean driving record.

  • Know your vehicle well, inside out

As a vehicle owner, you should already know every little thing about your vehicle. But if you’re not into cars and have little knowledge about things such as the model, make, and year of your vehicle, it’s time you pay more attention as this could help you get more affordable premium rates.

  • Upgrade the security of your vehicle

This is especially important if you live in a high-risk area. Make sure things like auto-lock and alarm are functioning properly. If you could afford it, consider installing a dash-cam for added security, or any other security device.

  • Don’t get add-ons that you don’t need

Some insurance agents may sweet-talk you into getting add-ons that you actually don’t need, so think carefully about what you truly need and don’t need.   Contrary to popular belief, detariffication is actually a good thing for vehicle owners in Malaysia. With the new premium calculation method, consumers can now enjoy lower premium rates, various insurance products tailored to their needs and budget, and overall better customer service.

*The content provided is for informational purposes only. FatBerry makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site. Should you require more information on our products, please refer to fatberry.com or contact us.

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Car Insurance Renewal: Basic Things To Know First

Car Insurance Renewal: Basic Things To Know First

It’s the new year, which means your vehicle insurance has probably already expired. Now is the time for car insurance renewal. 

For first-time vehicle owners, this might also be your first time renewing your vehicle insurance. Since vehicle insurance is compulsory by law in Malaysia under the Road Transport Act 1987, vehicle insurance renewal is something that you’d have to do every year, as vehicle insurance in Malaysia has a standard coverage that lasts for one year.

Vehicle insurance renewal is no longer a hassle now, as you can compare and renew vehicle insurance instantly and conveniently. Instead of visiting a few insurers to compare the plans one by one and going to JPJ to renew your road tax, everything can be done online now, including on our platform.

Have your personal and vehicle information ready before your vehicle insurance renewal

Before you start looking for the best vehicle insurance plans and renewing your vehicle insurance, some information will be required, specifically your personal and vehicle information. So make sure all of the information required is ready. Similar to when you were buying vehicle insurance for the first time, some of the info needed may include:

  • Your full name
  • IC number
  • Contact number
  • Address/location
  • Vehicle number
  • Vehicle model

High-performance engines: Higher premium rates

Keep in mind that you may get a higher premium rate if you own a sports car or a vehicle with an intermediate to high-performing rear engine model, compared to average cars. However, this doesn’t mean you can’t lower your premium rate.

For example, if your driving record is good and only selects the coverage and benefits that you truly need (minus the unnecessary add-ons), you could get a lower premium rate.

Understanding vehicle insurance detariffication

First, as a newbie, you must understand the Malaysian detariffication of vehicle insurance (or the removal of tariff). Before 2017, Bank Negara Malaysia was the one that controls the calculation method for vehicle insurance premium.

Once the tariff was removed, insurance companies can now implement their ways for premium calculation. Risk-based pricing is often the method used to determine your premium rate.

Risk-based pricing: The new method of premium calculation 

This means that aside from relying solely on your vehicle information such as engine capacity and market value for premium calculation, your risk factors will also be considered, such as your driving record, gender, and age.

This detariffication isn’t necessarily a bad thing, as you can expect better premium rates, various product selections, and improved customer service, as insurance companies are now competing with one another to provide the best plans for consumers.

How you can take advantage of the risk-based pricing method

Your premium rate will be higher the more risk you carry based on this method, and vice versa. You can try to lower your premium rate by knowing what insurers consider as risk factors, like:

How you use your vehicle

  • If you’re commuting to work daily, chances are your premium rate will be higher, especially the further your office is located and where you drive (like the highway), compared to a housewife who only uses her car to run errands.

Type of your vehicle

  • As mentioned previously, you may get a higher premium rate if you own a sports car or a vehicle with an intermediate to high-performing rear engine model, compared to average vehicle. 

Your claims history

  • Claims made previously indicate that you’re a high-risk driver. Therefore your premium rate will be higher.

Your level of education or occupation

  • As unfair and discriminatory as it is, the better your level of education or occupation, the lower the risk you carry, as perceived by insurers.

Your gender

  • If you are female, you may be in luck as your premium rate could be lower than most male drivers because female drivers are safer and drive more carefully.
  • According to The Global Status Report on Road Safety published by the World Health Organisation (WHO) and the World Bank in December 2018, Malaysia had 7,152 deaths in 2016; 87% were males and 13% females. 

Your age

  • Young and less experienced drivers are perceived as high-risk drivers, so the premium rate will be higher. 

Your location

  • City-dwellers will often get a higher premium rate compared to those living in rural areas because most cities have a higher rate of vandalism, theft, and road accidents.

Now that you know what risk factors are taken into consideration by insurance companies when calculating premium rates, it’ll be easier for you to figure out a way to get a cheaper premium rate.

There are at least two things that you can do to lower the premium rate, for example: 

Highlight your good driving record and zero claims history

  • Both will be in your favour.

Increase the security of your car

  • Ensure the auto-locks and alarms are working all the time. Install a few things if you can afford it, like a dash-cam. Reduce the risk of vehicle theft or damage by parking at a safe or well-guarded location. 

Avoid unnecessary add-ons

  • The more add-ons you opt-in to your plan, the more expensive your premium will be. Agents may try to sweet-talk you into add-ons that you might not even need. So think carefully about what you need as a driver. 

Once you fully understand how motor insurance detariffication plays a role in determining your premium rate and how to lower it, you can start setting up your profile on our platform for motor insurance renewal. Receive quotes, compare, and make add-ons instantly from the comfort of your home!

*The content provided is for informational purposes only. FatBerry makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site. Should you require more information on our products, please refer to fatberry.com or contact us.

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What Malaysia Car Insurance Covers (And Doesn’t)

What Malaysia Car Insurance Covers (And Doesn’t)

Most vehicle owners would know that car insurance is compulsory in Malaysia. But what about the coverages? What does car insurance cover and doesn’t cover? Find out more.

Just like any other product, car insurance (also motor insurance) plans in Malaysia aren’t all created equal. Though all car insurance plans available aim to provide financial protection for the policyholder (against liability, physical injury, or damage due to road accident), the terms and conditions and the add-ons may vary between insurance providers.

There are three kinds of car insurance policies in Malaysia: comprehensive coverage; third-party, fire and theft coverage; and third-party coverage. Each of these policies provides different kinds of coverage. Let’s take a closer look at every one of them:

 

Comprehensive coverage

  • As its name suggests, the comprehensive coverage covers mainly everything, not only the third party but also your vehicle. Whatever vehicle-related loss or damages that you are facing, you will be covered. However, this will also depend on your vehicle’s age, which means not every vehicle is eligible to be provided with this coverage.

Third-party, fire, and theft coverage

  • For the third-party fire and theft coverage, you will be covered for any claims made by a third party against you due to a road accident that results in vehicle damage, loss of property, bodily injuries, and death. This coverage plan also covers you for damages caused by fire or even grand theft auto (NOT the video game).

Third-party coverage

  • Meanwhile, the third-party coverage provides the most minimal and basic coverage, so it is the cheapest coverage among the three. As the name suggests, this coverage will only protect the third party involved in the road accident. 
  • Any damages done to your car will not be claimable. However, you are allowed to claim for whatever compensation is required by the third party.

Now that you know the basics of what the standard car insurance in Malaysia covers, you may be wondering what the standard car insurance in Malaysia does not cover.

What the average car insurance in Malaysia does not cover

It is important to note that while most car insurance offers coverage for third-party injuries or death and any damages done to your vehicle or the third party, neither one provides coverage if you are injured or passed away due to the accident.

For this, you will have to get personal accident insurance, which is separated from car insurance.

So when you’re comparing several car insurance policies, look out for the ‘Exclusions’ stated in each policy, as they may also vary between policies. Exclusions simply mean the losses that are not covered by the policy.

Some examples of exclusions include the following:

  • Your own bodily injury or death caused by a road accident
  • Liability against claims by passengers in your car
  • Liability, damage, or loss caused by natural disasters, such as landslide, storm, or flood
  • Tire damages (exception is given if other parts of your car are damaged as well at the same time)
  • Liability, damage, or loss that arises when you’re driving the vehicle for hire or e-hailing
  • Liability, damage, or loss caused by racing 

These are only a few examples of exclusions that you can find in various policies. Therefore the list is not exhaustive. You can only view the complete list of exclusions when you’re handed the policy contract (or a sample of the policy contract).

For this, you’d have to get in touch with an insurance provider of your choice.

 

Add-ons: Get the protection you want and need

Of course, if you are not satisfied enough with what’s being provided by the standard car insurance coverage, you can always opt for the add-ons. However, the more add-ons you get, the more expensive your insurance premium will be.

Your insurance provider will calculate your premium based on factors like:

  • Coverage type
  • Vehicle type
  • Driving record
  • Driver’s age and gender
  • Where the driver lives

Therefore, the add-ons that you choose depend on the factors mentioned above. Here are a few examples of add-ons, which are basically protection against damages or liability, that are available for policyholders to choose from:

  • Vehicle’s windscreen damages
  • Vehicle’s audio and accessories damages
  • Vehicle damages due to natural disasters (e.g., landslides, storm, or flood)
  • Vehicle damages due to a civil commotion, riot, or strike
  • Protection against liability claim from your passengers (in case of an accident)

To reiterate, not all plans are created equal. This means the add-ons provided by various insurance companies in Malaysia will also be different. If you’re looking for any specific add-ons, choose an insurance policy that provides the add-ons that you want.

That said, with so many car insurance plans available on the market, it can get overwhelming to compare them manually one by one.

Because comparing insurance plans can be time and energy-consuming, we highly encourage you to use an online insurance comparison platform like FatBerry for convenience.

Compare insurance quotations instantly and buy in three minutes!

*The content provided is for informational purposes only. FatBerry makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site. Should you require more information on our products, please refer to fatberry.com or contact us.

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FatBerry Raised RM2.5m in Pre-Series A Funding

FatBerry Raised RM2.5m in Pre-Series A Funding

Good news! FatBerry raised RM2.5 million (approx. US$600,000) new funding from equity crowdfunding platform, pitchIN to carry out FatBerry’s expansion and product development plans!

 

After two years of trial and preparation, our insurtech platform was commercially launched in April 2020 during the beginning of the pandemic. Fatberry has transformed the way consumers purchase insurance products in Malaysia via our insurance digital marketplace that allows customers to compare, customise and buy insurance products online instantly and easily. 

 

Pandemic Driven Explosive Growth 

With the pandemic and lockdown situation, consumers resolve to change their purchasing behaviour – many adopted online shopping almost exclusively for all their daily needs. This accelerated online purchasing behaviour has spurred explosive growth in demand for purchasing insurance online. 

As FatBerry is the most comprehensive insurance marketplace online for the Malaysian market, it is undoubtedly that FatBerry has experienced an impressive continuous monthly growth of 100% from June 2020 to February 2021.

Between June 2020 to February 2021, Fatberry’s sales have grown 6,800%. It is currently transacting 7 figure sales revenue for its platform on a monthly basis.

 

Funding to Fuel Further Growth 

“Post-FatBerry raised, our next step is to add more talent to our team, further develop our platform and product offering, as well as scale up our marketing and branding efforts. We will continue in our mission to help more Malaysians purchase insurance online with ease from the reliable and trustworthy insurtech platform of ours,” said FatBerry CEO John Tan. 

Malaysian consumers have now recognised FatBerry as the easiest and fastest insurtech platform that provides extensive customer care to make sure purchasing insurance online is a positive experience for consumers.

Our platform currently represents 11 Bank Negara Malaysia licensed insurers, facilitating largely transactions involving car insurance. With Malaysia having more than 10 million registered cars on the road, Car Insurance is the largest segment of the general insurance market of Malaysia by sales revenue.

 

Launch of motorcycle insurance to drive further growth

Earlier in April, we had also launched motorcycle insurance on our platform.

“Motorcycles are the most popular vehicle in Malaysia, making up almost half of the total number of vehicles on the road. Hence, it is a key expansion market for FatBerry,” said FatBerry’s Head of Marketing, Debbie Ang. 

Our platform expects the motorcycle insurance products to do well on its platform as the segment of this market is almost untouched, as traditional insurance agents would usually focus on high-value insurance products instead. 

 

Strategic Pre-Series A Funding Round 

The Pre-series A funding round was led by strategic investor Stockholm-based publicly traded venture builder Abelco Investment Group AB. Other investors who participated include ASX-listed Fatfish Group Limited and notable angel investors from Malaysia and Singapore.

 

 

*The content provided is for informational purposes only. FatBerry makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site. Should you require more information on our products, please refer to fatberry.com or contact us.

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RM1 Road Tax?! What RM1 Can Get You? Then VS. Now

RM1 Road Tax?! What RM1 Can Get You? Then VS. Now

RM1 road tax sounds too good to be true, but is it really? We are stoked to find out how excited Cik Manggis, a popular singer/actress, was when she compared the things you can get with RM1, then and now. Let’s check it out!

Many of us may have reminisced the good old days where things were cheap and life wasn’t as hectic as it is today.

Speaking about lower prices, did you know that you can get a lot of things with a mere RM1? Yes, indeed! 

To cut a long story short, Cik Manggis had recently shout out on her Instagram feed about the 5 Things We Can Buy With RM1, Then vs. Now.’

You’d be surprised to see her compare many things you can get with RM1 back in the old days and modern times. 

So, what can you get with RM1, then and now? Check out the comparison:

 

ITEM

THEN

NOW

Roti Canai

5 pieces of roti canai and
1 can of dhal

1 piece of roti canai

Candies

100 pieces of candies
(1 cent each)

10 pieces of candies
(10 cents each)

Ballpens

4 ball pens
(25 cents each)

1 ballpen (RM1 each)

Tickets

40 cents/ticket
at the Asiatic Cinema

RM1/ticket
(short-distance bus ride)

Things definitely seemed cheaper in the olden days. However, what about the fifth one? What is the other thing you can get with RM1?

 

Here comes the best part…watch her video to find out more 👉🏼

 

 

View this post on Instagram

 

A post shared by Cik Manggis | De Fam (@cikmanggis)


The good old days may have won the first four rounds of comparison, but it sure can’t beat this king of all cheap prices: RM1 road tax! Yes, you’ve read that right! That’s RM99 less than the normal price of road tax back then!

RM 1 Road Tax

In partnership with Visa, you can now get RM1 Road Tax with FatBerry*!

Enjoy this special promo when you RENEW your car insurance and pay with your VISA card on FatBerry’s platform.

That said if your car insurance has not expired yet, don’t worry! Simply CHOPE* for your next renewal. How’s that for the biggest saving of all?

*T&C Apply

*The content provided is for informational purposes only. FatBerry makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site. Should you require more information on our products, please refer to fatberry.com or contact us.

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