13th March 2017 - 5 min read
Car insurance is an essential purchase for every car owner and since we have to renew it every year, saving up on it means saving up on our annual expenses, too. We’ll show how to save as much as possible and get the most value out of your policy with these clever tips:
Car insurance policies, namely ‘market value’ policies don’t often pay (in cases of total loss) for the total amount insured. It’s pay-out is determined by the market value of your car at the time of the incident claim. Thus, it doesn’t make sense to insure your car for more than what it’s worth and pay higher premiums when you may not be able to claim for it later.
Instead, here’s what you should do: look for ‘agreed value’ policies that offer a pay-out that is based on the value insured rather than its declining market value. Not all policies offer this option though, so do check with your provider before purchasing. If you are opting for a depreciating market value policy, be sure to insure your car for an amount that is closer to its market value.
This will probably help your case even more now that the second phase of detariffication for car insurance is expected to come into effect in 2017 . Soon, car insurance rates will no longer be regulated but essentially determined by risk factors. This means, any security features that you add onto your car to prevent theft, loss, or accidents can help to lower your premium rates.
Features such as immobilizers, special alarm systems, GPS tracking devices, and even the act of parking indoors overnight could help reduce the quoted rates. Just be sure to have your car inspected thoroughly before purchasing your car insurance, so that you can justify all the added security features to the insurance provider.
Apart from the no-claim discount (NCD) that essentially rewards you for not making claims, there are other discounts you can take advantage of to reduce your insurance costs. For one, some insurance providers may offer discounts when you insure more than one car with them under your name or your immediate family. You should also look into online renewal discounts and promotional offers, especially when purchasing a new car.
Otherwise, you can also try asking for loyalty discounts especially if you have been with the same provider or agent for a long period of time.
Read also: Is Takaful Motor Insurance Better For You?
Whether you’re a veteran or a newbie, it’s important to understand your car insurance plan thoroughly in terms of what it covers and what it does not. For instance, modifications made to your car may not be covered if damaged in an accident, unless you’ve specifically requested for it to be insured and paid the additional premium.
The same goes for damage from flood, landslide, storm and riot, which will only be covered if you add it onto your policy.
Do note that these add-ons can significantly increase your premium, so it’s a good idea to think them through before agreeing to pay the extra premium. After all, why pay for something that you don’t need?
If someone else drives your car even on an infrequent basis, add his or her name to your policy – after all, the first two names (yours included) are free. You’ll want to do this to avoid paying a Compulsory Excess Fee of RM400, which will incur if the person driving your car gets into an accident and isn’t listed on your car insurance policy.
Note that this fee could still be charged if the person driving your car happens to be a ‘P’ (probationary) driver, ‘L’ (probationer licence) licence holder, or under is 21 years of age. A Compulsory Excess Fee is different from a Policy Excess, which is applicable when you’re making a claim.
The Policy Excess Fee varies from one insurance provider to another, and is imposed at their sole discretion. For example, if your Policy Excess Fee is RM200, you won’t be able to make a claim for any damages that is below this amount. It also means that if the damages to your car is, say, RM3,000, you’re only entitled to a total claim of RM2, 800. Try to find a policy with low or no Policy Excess Fee for better savings!
Your insurance policy often comes with special benefits that you might be aware of. Most comprehensive policies offer free towing, repair warranties, as well as complimentary roadside assistance in the cases where you need help changing a tire or jump start your car. However, not every policy will offer these equally, so it’s important to shop around before settling on one.
The easiest way to look for a comprehensive car insurance that is perfect for your beloved road companion is of course by going through our car insurance comparison page. Remember to take your time to read through the available car insurance listed on there, and make every ringgit that you pay for your car insurance policy count!
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