Increasing Insurance charges for vehicles more than 10 years

[Rex551]

Good Day to all,
Lately I went over to renew my yearly Roadtax and Insurance for my 1997 Honda Ex5 (100cc) motorcycle. My motorcycle is now 12 years old and in excellant condition. The thing that got me fuming is the charges for the insurance premium. It seems to be ridiculously increasing by the year.
So far when my bike was below 10 years old my insurance premium would amount to not more than RM50-RM60 only. Last two years after it reached 11years the premium shot up to about RM80-RM90 (Third Party). This year, it has increased by another RM36 because all vehicle insurance companies are enforcing a PA onto the vehicle owners of all vehicles more than 10years old. Isn't this absurd ?. Why burden owners of old vehicles with unnecessary charges ?. Is it really a fact that our old vehicles are just not worthy and problematic until the Insurance companies are spending tons of money over claims ?.
What's even sickening is, when I asked the agent "what happens if I don't make insurance claims or use my existing insurance coverage if at all something happens ?", to which she answered "burn lor". Isn't this daylight robbery in the name of insurance ?. She meant that I can't claim from this new PA if I'm claiming from other insurance policies and if there's no claim than consider expired without claim...
What do you all Think ?. I'd really like all ZTH sifous views and recommendations on what we can do to put a stop to all this new policies enforced onto us consumers. As customers and owners of vehicles we deserve to have a choice and fair charges. Not simply pay...

 

[aalto]

I'm not trying do defend insurance companies or anything...but i understand the situation.....next year if i'm not mistaken there wont be 3rd party coverage for motorcycles or cars anymore.... due to the fact that claims have exceeded premiums.

Yes...the value of an old motorcycle might be cheap, but insurance companies have to cover everything else also....

For example a motorcycle hentam a car, the cost of claims for repairs may go to about RM1K....but the motor only pay premium of less than RM100..and usually this is the case.

So insurance companies are losing money from 3rd party claims, so thats why they need to raise the premiums, coz they are at loss with current rates.

Insurance rates are based on risks calculations, and it seems that motorcycles are high risk due to the rise of accidents by motorcycles. If there are alot of claims then they'll surely raise the rates.....who wants to do business at a loss?

Thats how insurance works, you pay little but if anything happens the insurance company has to pay alot. The money that u pay is considered something like "protection money". Thats why they have NCB, "if no claims then they give discount".

Anyways, I'm just glad that we dont have insurance rates like the UK. The premiums there sometimes can be more expensive than the cars!....and they take account of everything, how old u are, where u live, summons.....etc...

 

[csl]

Another thing missing. The insurance is not only cover the properties damage, but also all other thing that involved with the accident. Example, if you hit someone and he become permanent disable, he definitely will sue you for compensation. $$ from RM20k to unlimited, depends on who is the victim (Young one normally get more money. But if die, then will be lesser than alive and suffer with pain). My relative got an accident and she was the victim. the insurance company paid her RM50k because the accident cause her broke her chest bone. My brother in-law died in an accident later on, only got RM40k.

In terms of the risk assessment, old vehicle normally is not as safe as new one, because of the structure may aged and easier to deform or parts may break and cause serious accident. Other things like maintenance or etc, do not have enough evident that to prove the safety of the vehicle is up to the level of the moment (eg, nowadays, most car fitted with ABS as a standard. 10-15 years back was optional accessories. In next 5-10 years, DSC will be a standard equipment and some other high tech thing will become optional accessories). So, the risk of older vehicle will be categorized as higher level compare to newer vehicle.

On the [what happens if I don't make insurance claims or use my existing insurance coverage if at all something happens ?] issues, the insurance will give you NCD up to 55% discount on the full insured amount. The rest of the 45% is use for the company expenses (eq, claims from other parties, operation cost, share dividend, business expension, and etc). You can imagine if you hit someone and the insurance company paid RM50k for everything, how long will the insurance company recover the cost by the mere RM1xx paid by you per annum?

All the cost were that charged to you were carefully calculate (including your affordability) and approved by bank Negara and Gov. Nothing to be blame on the charges except those who drive a K car at 130-170km/h on the highway and those superman kapchai hero. Of cause, if you are thinking the insurance companies should lower down the cost but raise the access fee, then bank Negara sure will not approve because this move will make the bankruptcy rate raise thousands more times, you know what I mean.

 

[Rex551]

Aalto,
Thank you for your reply. I get your point. But let me put your views into scenarios...

Scenario 1,
My bike is 12 years old. So far, thank GOD, I've never made an insurance claim and my NCB is now at 55%.

1) So, how much loss as the insurance company incurred so far because of me ?.

I'm not saying that the majority of old vehicle owners never make claims, but can it be concluded that the amount of claims on behalf of old vehicles are far more compared to the figure in payments made to the insurance companies ?.

2) Which is more valuable and expensive to maintain ?.

Are you telling me that to repair an old vehicle would cost almost as much as a new vehicle given the same type of repairs needed, forcing old vehicles the need for higher premiums ?. Aren't premiums supposed to be based on actual value of the vehicle ?. As far as I know, vehicles and parts depriciate by the year. Not like property where it appreciates. So why must premiums for depreciating valued vehicles increase yearly ?
3) Let's say, we accept the additional charges in the name of PA (Personal Assurance). Is it fair to not be able to claim when we are already covered by existing policies ?.


Scenario 2,
Let's say as you've mentioned above, there's an accident. If the motorcycle had a first party insurance, and it's the motorcycle's fault, obviously what would happen is that the repairs for both vehicles would be claimed from only the motorcycle's premium. That means for a first party insurance premium and a new bike, the amount of claim would definitely be much much more since both vehicles will be repaired under one claim (Tarik Kereta Garage Khawthim). agree ?. That means new vehicles, with low premium payments get to make higher claim amounts.
But if it's an old motorcycle and a third party premium, the claim would only cover the other vehicle and definitely be much cheaper since only one vehicle is being repaired under the claim. This proves that for old vehicle premium charges are higher but claim amounts would be lesser. Isn't this absurd ?. Once again do not forget the number of claims Vs total payments made by all road users.
You also compared charges of premiums in other countries vs the charges here. I have not been to UK but know how it works in Singapore. Yes, vehicle owners in Singapore are taxed more for their vehicles. But that's because of the quality of their roads, facilities and amenities. I mean, if it's expensive elsewhere, that's because it's worth it. How close can we be ranked in all these aspects to those countries that charge more for premiums ?. Is it justified ?
Lastly do you know why Hypermarts can offer products at cheaper prices compared to normal grocery shops ?. It's because they buy in large qty (Bulk) and get better rates allowing the price of goods to be cheaper to the consumer. That's the way it should be with a lot of things if, it involves a large number payments vs claims. To be honest, if the whole of Malaysia feels it's fair for the insurance companies to keep increasing their premium rates I will definitely not argue, but is it the case ?. Are all the ZTh members agreeing to this ?......

 

[EvolutionZ]

Scenario 3,

all accidents repair, body injuries, property damages, permanent disability, hospitalization are the most crucial for insurance company to bear the losses. the cause of these high claims are due to runners, workshops, middleman, agents, the court that award the amount of compensation, the policeman to determine who's at fault etc etc

i have some friends who run workshop, they marked up the parts double or even triple then submit for claims, later they just use back the damaged parts and plaster it, cement it and paint it nicely. the absorbers just sand paper it and paint it black....treat as its new. then deliver the car to customers. but telling customers insurance company not paying la....this la that la...normal...they are sucking the insurance companies money....working together with the adjustor......some kopi money...all also rosak.....all must claim....

another scenario, the bumper slightly dented, but later after towing, the whole bumper, including the foglamps and headlamps all broken...why?? more claims ma...

then some motorcycle injuries, property damage, hospitalization etc...agents or brokers or runner will do up the claims....from rm100 to rm10,000 claiming very serious injuries, serious damage, etc etc.....

some so call highway hooligans aka callman - heroes that i encountered many times....creating accidents by....u know la...all sorts of ideas just to get car towed into their workshop.

so the insurance companies, knowing these ppl (middleman) are making huge bucks manipulating the claims......resulting in great losses as they claimed they facing now....SHOULD not pick on the end user to absord those "bloodsuckers" wrong doing.

we as end user/consumer do not wish to have any accidents/injuries or damages, so why not insurance company do their best to figure out how to reach US, the consumer directly by eliminating those "middle man" and improves the communication and services towards us..

i think better this way, than increasing the charges to innocent ppl .....just my 2cents.!

 

[Rex551]

Finally,
Someone who sees the scenario my way. Thanks "EvolutionZ"

So what can we do about it ?....

Get Bank Negara to adress the issue like how it's dealing with the money changers ?...
Make a Police Report so more duit Kopi can be rolled around ?....

What can we do ?.....

 

[aalto]

Rex 551,
I get the logic that you are trying to point out,
but insurance companies have actuaries whom analyze the actual data of accidents accordingly to access the risk levels. To us simple minded folks it might be as easy as saying this & that, logic this & that.

But they have actual data to backup the premium rates being charged.

Best to my knowledge if road conditions are worse, then premium rates should be higher due to higher risks. Also insurance premiums have nothing to do with road quality/facilities & amenities. Thats JKR's job or LTA in Singapore.

And your hypermarket theory, sounds logical for consumer products...but not for insurance premiums, bcoz they are based on risk assessment & claims. Lets say they sell the same big bulk for 2years & this year and say 10% claims, but next year 30% claims, for sure the latter year they lose money. But for consumer products same bulk both years means same profits.

And with scenario 3, well thats a problem not just with insurance adjustors, but almost everthing else in Malaysia, corruption-dishonesty-corruption everywhere......and who's paying for it ...everyone is....for this youd have to go to Malaysia-today.net for answers...

I'm all for lower rates.
.....but the only way you can take on the insurance companies is with hard facts & data, independent studies by consumer groups so as to outline the actual figures to Bank Negara to tell them the insurance companies are overcharging us.

Or you can move to Sabah & Sarawak........premiums there are way cheaper than here....

 

[Rex551]

Aalto,
Thanks for your views and participation. I'm tired of typing already ler. I've highlighted my concern and that's it. I've renewed my insurance and am still happy to use my good old bike.

Based on the whole thread so far....

1) I will never accept the increasing charges
2) You feel the charges are reasonable
3) And all the other Zth members who've logged in since this thread was launched just have
nothing to say. That's just the way it seems...

Hehahehehe,
This is Malaysia maa. "Bila sakit baru nak bising". Until then apa apa pun boleh laaaa. Those in business here, will always justify their charges with facts and figures that the Govt never investigates or the lay man on the road won't understand. From the vegetable seller to the Insurance company, everybody will keep increasing their charges with some justification. Looks like there's no doubt that Malaysia is another Zimbabwe.

Hehaheheh

 

[aalto]

Rex 551,

Your welcome....I'm tired of typing too...hehe

I'd just like to point out, In my opinion, the real problem isn't really the insurance issue, but the cost of living in Malaysia....Every year it seems to get tighter on our pockets, our salaries aren't keeping up with the inflation rate...

Too much of the tax payers money is wasted due to poor governance / corruption.....and were paying for it whether we notice it or not...

So....like I said before, visit "malaysia-today.net " maybe it can open our minds a bit so we dont turn into another Zimbabwe twin....:wavey:

cheers...

 

[csl]

Wallet sakit is the only way to make you move faster and higher If you are still stay in the comfort dream, then yes, another Zimbawee is in the making.

 

[fawzi]

Rex551 i'm with u i'm also ride old 750cc 1989 bike and old Satria 1995. My insurance also was 3rd party for both vehicles, so now how sakit i'm if i should change to 1st party..??
i hope someone will open the mata and mind and look into this ..
and i hope this insurance company also record for those who got a lot of claimed will got the higher premiumand etc2...and for those who never claimed will continue the insurance as usual.
And DON'T terminate this 3rd PARTY INSURANCE PLEASEEEEEEEE....HUHUHUHUHUHU

 

[Rex551]

Fawzi,
You know, I know laa. But changes and improvement will only take place if we are the majority of roadusers. Right now, based on the thread so far, there seems to be others who don't see things our way too. So I guess you and I will just have to bite the bullet for now. To tell you the truth, I'm just pissed with the state we've all put Malaysia in.

CIMB..... making profits
Petronas.....making profits
PLUS..........making profit
AirAsia........making profit
Insurance companies.....
Everywhere.... all businesses making profits....

But how comfortable are we the "Rakyat" who fuel their profits..... ?
Bottom line, it all boils down to how many of us are going to put a stop to this bullshit only. The more of us, the sooner and definite a solution we will achieve.

Until then........
Sakit ler//

 

[JINEIL2EN]

if i can get APs, i oso can making huge benefit...

 

[EvolutionZ]

AP nowaday not that simple bro....some more u need to CUT 1st!!!

 

[JINEIL2EN]

AP nowaday not that simple bro....some more u need to CUT 1st!!!

i cut edy ma... for a few weeks... then now 'sambung' back again.. coz the 'line' not 'clear'...

 

[Fairlady350]

I think the bottomline is that vehicles in Malaysia are over price and the cost of living is way higher than what we are earning. Therefore, the reasons for this very thread to come to life.