7 Smart Ways: Save More on Car Insurance

Key Points

  1. BEWARE: Choose the right types of insurance coverage.
  2. Make sure to insure your car in the right way (don’t overinsure or underinsure).
  3. Shop around and compare car insurance on other online website.

When we talk about car insurance, we will undoubtedly think it is EXPENSIVE! And if possible, we would like to get the cheapest car insurance coverage possible. Did you know that owning car insurance is vital to all drivers in Malaysia? For you to drive on the road, you need these two things: insurance and road tax. If not, don’t let yourself be trapped in an unnecessary situation.

Whether you like it or not, whether it’s expensive or not, you still need to get car insurance. Under section 26 of the Road Transport Act 1987, you will be given maximum imprisonment of 3 years and/or a fine of up to RM1,000.

Nowadays, all things, not just car insurance, are considered expensive. But, there are always ways to save your money on everything, not just car insurance. Hence, we have prepared 7 smart ways or tips that can help you reduce the amount of money you spend on your car insurance in the future.

1. BEWARE: Choose the right types of insurance coverage

As we all know, only three (3) types of insurance coverage are available in Malaysia. Before purchasing or renewing your car insurance, think about your vehicle’s age, driving habits or record, credit history, and distance driven. These factors can help you choose the right coverage for your car.

Types of Coverage Definition
Third Party Cover This is the most basic sort of insurance or coverage because it only covers losses, damages, or deaths caused by others. Third-party will make a claim against your insurance/takaful company if the accident is due to your fault.
Third Party, Fire, and Theft Cover This sort of insurance is similar to the previous one. Still, it also covers your own vehicle in the event of a fire or theft.
Comprehensive Cover This is the most complete coverage, as it covers not only all of the above but also your vehicle in the event it is destroyed in an accident.

Comprehensive car insurance is the best option. It allows you to add extra coverage like windshield, named driver(s), and compensation for assessed repair time (CART), among other things. However, it’s critical to choose the appropriate level of protection and ensure that this additional plan meets your requirements. Adding too many features to an already expensive policy can increase rates!

2. Avoid modifications on your car!

Some of us, I’m sure, would like to customize our vehicles and add features that make them more desirable than others. But did you know that any adjustments you make could raise your insurance premium? Because all of these modifications increase the chance of theft, you will be charged a higher premium because the objective of insurance is to cover the risk. Click here to see the types of modifications the Road Transport Department Malaysia (JPJ) allows.

Notifying your insurance company about any modifications you’ve made is critical. This is so that your car is adequately insured and your insurance company can adjust your rate to cover every component of your alteration.

3. Check out for the special PROMO if you are lucky!

Who doesn’t like a good promotion? To save money on your car insurance, keep an eye out for special offers from your insurance provider. Seasonal or special days, such as 11.11, 12.12, Payday Day, Merdeka Sale, Year End Sale, and others, are standard months for promotions. So keep an eye on this promotion because if you’re lucky, you can get a discount on your car insurance! YEAH!

4. Drive carefully on the road, be a good driver

This is one of the ways you may cut your insurance costs! It’s simple: drive carefully and obey all traffic laws to lower your chances of being involved in an accident and obtaining traffic tickets.

If you are in an accident, you may be obliged to file a claim for damages, and the size of your claim and your driving record may affect the price of your insurance coverage. Remember that your NCD discount may be affected as well. So, be cautious and drive safely at all times.

5. Make sure to insure your car in the right way (don’t overinsure or underinsure)

There are two types of being insured such as overinsured and underinsured.

Overinsurance happens when you insure your car above the market value at the time. Underinsurance happens when you insure your car below the market value.

When you overinsure, you will spend more money than necessary. The claim amount is established by the car’s market value at the time of damage or loss in this situation. Your insurance company will only pay the claimable amount based on the repair price. Meanwhile, your insurance company will only pay half the cost specified in your policy if you are underinsured.

However, it is critical to insure your car for the agreed-upon value since this will allow you to make claims based on the policy’s terms.

An example of a sum insured formula is as follows:

Loss amount payable = Sum insured/Market value x Assessed loss

6. Keep your No-Claim Discount (NCD)

Did you know that getting a No-Claim Discount (NCD) is one of the methods to save money on your car insurance? You must have a claim-free record for the past 12 months to qualify. When it’s time to renew your car insurance, you’ll be able to take advantage of the NCD. The NCD is not available to first-time car buyers until the first renewal without any claims). Let me show you the NCD percentage:

No-claim period Private car Commercial car
1st year 0% 0%
2nd year 25% 15%
3rd year 30% 20%
4th year 38.33% 25%
5th year 45% 25%
5th year and onwards 55% (NCD maximum rate) 25%

7. Shop around and compare car insurance on another online website

There are numerous online platforms where you may compare vehicle insurance quotes. Before you do anything, research several trustworthy websites and compare rates and benefits until you pick the one that best suits your needs! Different websites may have different rates or features, so it’s crucial to explore beyond their initial offerings to see what else they offer.

Luckily for you, PolicyStreet is here to help! With just one click of the mouse or tap on your phone screen, you can get an instant online quotation that includes all the necessary information for your car insurance. It’s so simple!

Related: 10 Cars with the Cheapest Insurance in 2022

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