The deadline for submitting your protest or suggestions or even arguments over the proposed TPBID mandatory (Newco) scheme is already over. The government has decided, and the new basic third party insurance policy will be sold nationwide come Jan next year….This basic third party policy is the minimum insurance version that insurers would be selling and is really nothing different from the existing third party insurance cover, except the Insured(s) will not be imposed any loading without the sanction given by the Newco….
This third party basic will be in two major sections – one being the mandatory third party bodily injury & death (TPBID) and the other part the third party property damage (TPPD). The former section (or the mandatory section) will be segregated and remitted to the Newco for TPBID, and the latter, continues to be part of the insurers and takaful operators’ domain.
Please note that the limit imposed on the TPBID is RM2 million – not sure if this limit relates to an event or to individual injured third part – most likely it is on individual party. Anyway, it is good to note that there is already an existing TPPD limit imposed in the existing motor policy, and it is unlikely to be amended….
The Insured has the option to top up this basic third party cover with a voluntary third party liability cover – perhaps the limit is up to the individual insurer providing the cover. The likely maximum limit that I know at this very moment is RM50 million…. that’s the most, which unlike now, is “UNLIMITED”! Premium-wise, it is likely to be tariffed although the industry is requesting for insurer’s independent rating.
Of course there are other top-ups (with premium) like, damage to own vehicle, theft, liability to passengers (limit is likely to be capped at RM2 million), personal accident, windscreen, etc…..
Please do note…. Insured cannot just buy a basic third party insurance from one insurer and then buy the other non-third party sections from another!
While Insured will not be subjected to loading on their third party insurance, this cannot be said for the other sections of the coverage. However, if any form of loading is to apply, the percentage or quantum cannot exceed those prescribed in the tariff or those of Bank Negara’s permissible level.
Of course with this new scheme and creation of the Newco, insurers and takaful operators are going to lose out! Looks stupid for not loading those COMMERCIAL and HIGHER RISKS VEHICLES, right? Anyway, according to the new agreement under the TPBID Newco, the industry is not supposed to load on the third party basic policy…. Hopefully, the Bank Negara would not stick to such a decision…..
Hopefully, MMIP is NOT disbanded and continues to serve the HIGH RISKS MOTOR CATEGORIES and it should stay that way….at all costs, thus giving room for insurers and takaful operators to manoeuvre in rejecting those higher commercial vehicle risks.
WHATEVER THE DIRECTION THE INDUSTRY IS TO TAKE…… AS CONSUMERS WE SHOULD REJECT THE LIMIT ON TPBID THAT IS SET AT RM2 MILLION! Despite the existing limits already imposed by various statutory laws like the Civil Law Act, Malaysian should DEMAND for a much higher limit, at least, we should be getting a limit nothing less than RM15 million.
Although the richer Malaysian can buy the voluntary top-up, but it is unlikely that our poorer cousins would be taking up any – thus relying on just the mandatory cover!
This method of TPBI liability top-up is not practical and lend a hand towards the rich oppressing the poor in the even the richer third party claimants are adamant towards getting the poorer folks bankrupt via the court process….. therefore, likely to create AN UNJUST SOCIETY!
MALAYSIAN SHOULD NOT GIVE UP THEIR RIGHTS TO THE EXISTING “UNLIMITED LIABILITY” ALREADY PRESCRIBED IN OUR ROAD TRANSPORT ACT! This is already our RIGHTS! If there is a need to give in, then the limit should not be less than RM15 million…. as the highest known TPBI claim that was successfully made did hit near the RM12 million mark! It certainly does not sound intelligent talking about 92% or so of all TPBID claims as falling below the RM2 million mark, therefore we should use the RM2 million as the limit!
Moreover the Newco can always purchase some form of reinsurance to protect any losses hitting pass the RM2 million mark, and I must say is not going to be expensive…. Thus, there is really no reason for such a small limit of RM2 million!
I sincerely hope the industry experts should balance up the industry’s and consumers’ rights in the most sensible of ways….