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What is Comprehensive Car Insurance? Who Should Buy It?

Key Points

  1. Comprehensive car insurance provides the best protection for you and the third party.
  2. Add-ons are available to get extra protection.
  3. There are a lot of factors that affect the price of comprehensive car insurance.

Even the most careful drivers can get into car accidents. Whether it’s a small bump or major collision, natural disaster such as flooding and even if you’re not at fault for whatever happened to cause these unfortunate events in your life. This is where car insurance comes in to play the magic!

Doesn’t matter if you’re driving a Proton or BMW; one thing in common is that they must be protected by car insurance before driving around the road. Hence, getting car insurance is necessary in Malaysia if you purchase a car. The questions are, which insurers and what types of car insurance should you choose?

This article will give you information about comprehensive car insurance and why you should choose one to protect your beloved (we suggest only the best for you!).

Types of car insurance in Malaysia

Before explaining comprehensive car insurance, do you know how many types of car insurance there are in Malaysia? Three kinds of car insurance in Malaysia are Third-Party, Third-Party, Fire, and Theft, and Comprehensive car insurance.

  1. Third-party
  2. The cheapest form of car insurance in Malaysia is a third-party cover. However, this policy does not cover any damages to you or your vehicle.

  3. Third-party, fire, and theft cover
  4. Third-party, fire, and theft cover policies work like traditional third-party insurance. The exception is that you can make claims if your car suffers from any damage due to fires or if it gets stolen.

  5. Comprehensive car insurance
  6. We will talk more about comprehensive car insurance in the next part.

What is comprehensive car insurance?

Comprehensive insurance is the most comprehensive form of vehicle coverage. It offers protection against theft or fire and additional protection for your car, including damages caused by other people who may try to steal it!

Using bank loans, you must buy comprehensive insurance if you purchase your new car. However, if you buy a lower-value vehicle OR an old-used car, then it is not necessary to get a comprehensive policy.

What is the difference between comprehensive and other types of car insurance?

Comprehensive car insurance covered not only third-party loss but also the loss and damage of the policyholder’s vehicles. However, the loss and injury of passengers are not included.

The compensation amount received by the policyholder depends on the following:

  • The market value of the vehicle at the time the damage or loss occurred
  • The agreed value in the policy
  • Any that is priced the lowest

Are add-ons available for comprehensive car insurance?

Yes! You can purchase add-ons to have extra protection for your vehicle and the passenger. Add-ons provided might differ from different insurers. We stated below a few common add-ons available for comprehensive policy:

  • Protection for additional drivers
  • Windscreen protection
  • Special perils protection
  • Strike, Riot, and Civil Commotion (SRCC) protection
  • Legal liability to and of passengers
  • Car accessories replacement coverage
  • *e-Hailing

*Not every insurer provides this add-on.

You can refer here if you are confused about which add-ons are worth getting.

Do you need comprehensive car insurance?

It is good to have comprehensive car insurance. Although it is expensive, it provides the best protection for both third parties and you. You should get one if you purchase a car using a bank loan OR your car is higher valued (expensive repair cost / higher market value).

However, like what we mentioned above, if your car has a lower value OR you can self-finance the car, getting the cheapest third-party car insurance is the most suitable choice.

How do insurers calculate car insurance premium rates?

A few factors are considered:

  • Age
  • Lack of driving experience (P license) will need to pay a higher premium

  • Gender
  • Different countries might have an extra premium for ladies

  • Occupation
  • If your occupation is required you to drive more, the higher premium needed to pay

  • Residence
  • Depends on where you live. A higher crime rate area might affect the premium due to the higher risk of the car being stolen

  • Claim history
  • If you claimed too often previously, a higher premium rate needed to pay

  • Age of car
  • The older your car, the higher the premium rate of car insurance

How can I make a claim?

There are two types of claims you can make if your insurance covers damages for major damage:

  1. Own Damage Claim
  2. Making a claim for damages sustained in an accident with your policy will reset your NCD (No-Claim Discount) to 0%.

  3. No-Fault Own Damage Claim
  4. No-Fault Own Damage Claim is also a claim on your own policy. Still, it doesn’t forfeit your NCD as it’s applicable when the accident your vehicle is involved in is not your fault.

If you need to know the details and documents required while claiming, click here to understand more.

Verdict

No matter how safe you drive, unforeseen situations happen. It is better to safeguard yourself from any financial loss due to car accidents by getting car insurance. You can visit here to get the car insurance that best suits your needs.

Also, do not panic when you are involved in car accidents, as we got your back! Check here to learn more about tips you should do after getting into a car accident.

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