You may have been asking around, and realized that every insurance company quote you differently although the coverage is the same. This is because Bank Negara Malaysia has actually started to de-tariff the general insurance, meaning that the insurance company are now allow to set the premium as they wish due to market condition.
In the past, general insurance is tariff, meaning that Bank Negara fixed the rate, thus, all insurance company will quote the same premium for a same coverage. But now, with the de-tariff, insurance company has a free hand on how much their wish to charge as long as it is within the allowed range.
This actually make sense and allow more competition to benefit the consumer. You now can shop around to find a insurer that suit you. Similarly to telco, you will have difference needs and lifestyle, thus, no one plan suit all coverage.
With the flexibility to determine the insurance premium, insurance company can now offer innovative products or add-on for extra premium, thus, allowing insurance company to differentiate themselves.
Different insurance company will have different risk appetite and risk strategies. Their evaluation of risk profile & weightage will affect the overall premium. Generally, insurance company will take the following consideration:
- Driver Age
- Driver Gender
- marriage status
- Car model
- Car age
So, based on a driver profile, insurance company will offer their premium to provider coverage. But it is not just you – the driver. There are about 20+ general insurance companies in Malaysia, and each insurer has it strength and coverage etc. A leading insurer with many branches, support network, panel workshop all over Malaysia can definitely charge a higher premium. An insurer with well recognized branding and high service level can also command a higher premium. Thus, customer should not just compare premium.
It is like buying a car. A reputable and reliable brand with many service centres and high resell value will cost more compared to a smaller brand with limited features and low resell value.
If pricing is your main concern, then, by all means look for the cheapest, since it is your priority, but if you are not too cost sensitive, then, we suggest you insured with the top 5 insurers in Malaysia. They became Top 5 insurer for a reason. Read here if you wish to know the Top 5 insurers in Malaysia