First and foremost, we need to differentiate between the term, market value and agreed sum. For an example, when the vehicle is insured under market value, total claims paid will be based on current market value of the said vehicle. If the vehicle was insured at RM40,000.00 and the current market value of the vehicle is RM35,000.00 at the time of the accident, then the maximum compensation for total loss situation would be capped at RM35,000.00 subject to other terms and conditions. However, for policies based on agreed sum, the current market value of the said vehicle is irrelevant and total compensation will be solely based on the insured sum. For an example, if the said vehicle was insured at RM70,000.00 and the market value of the said vehicle depreciated to RM50,000.00 at the time of the accident, compensation to be paid will be at RM70,000.00. Next point will be on the two other terms which will be the following, liability arising due to an act of a passenger and liability towards passenger. For this point, if your passenger were to open the door suddenly and it resulted in an accident with other road user, there is a high possibility that the current policy will not provide coverage for the said act and you are likely be required to pay the claim personally. However, with the additional coverage (usually there is an additional payment requirement, but low) protection will be given for such situations. For the second situation, will be on liability towards passenger. For an example, if your friend who had been traveling with you in your vehicle gets injured due to an accident as a result of your negligence, the general rule is that your friend will not be able to make an insurance claim against your motor vehicle policy. However, with additional coverage (usually there is an additional payment requirement, but low), protection will be accorded in such situation. It is also pertinent to note that that most of the motor vehicle policy does not provide automatic coverage for losses as result of natural disaster. It is suggested that it would be wise to purchase additional coverage for natural disasters more so if you are staying in flood prone area and so on. Next point will be on the issue of windscreen cover. This is something that is common nowadays but many under insure for windscreen cover resulting in having to top up when making a claim for windscreen damage. It is best to first check with value of windscreen with authorized panel or workshop and then proceed to insure accordingly as per the value suggested. Final point will be on the towing coverage. It must be noted that many insurance companies now provide free towing when you purchase your motor vehicle policy with them. However, many companies have different coverage and policy when it comes to towing. It is best to research this benefit and compare a few products first before deciding which coverage is best suited for your needs. Please watch the attached video clip (in Bahasa Melayu) for better explanation on the said topic. Podcast link (Spotify) attached at the bottom for the audio podcast.

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