3Cs for Proper Insurance Coverage

PIAM, the General Insurance Association of Malaysia, has provided guidelines to help motorists ensure that they and their vehicles are properly covered by insurance. The association’s simple guidelines come under “3Cs”:

1. COMPLETE insurance proposal forms honestly and accurately before signing;

2. CHECK the policy upon receipt to ensure that all information contained is accurate and correct (particularly details of the vehicle and owner); and

3. CONTACT the insurance company if any information is inaccurate or there is a need to update the information in the existing policy (eg change of address).

“Whether it is buying a new policy or renewing an existing one, of even when submitting a claim after an accident or theft of the insured vehicle, it is critical to provide a number of items of information accurately,” advises PIAM executive Director C.F. Lim.

The items are:

1. New IC number of policyholder/driver
2. Make and model of vehicle
3. Year of manufacture of vehicle
4. Capacity of vehicle (the engine size in cc)
5. Gender of policyholder/driver
6. Age of policyholder
7. Residential address of policyholder/location where accident or theft occurred for which a claim is being made.

Mr Lim also advises motorists to refrain from signing any BLANK proposal form. The information contained in the proposal form that is usually provided by a salesman when signing up an order for a car forms the basis of the insurance contract. If it is inaccurate in any way, the contract could be declared invalid in the event of a claim being made.

Policyholders should also check their insurance policies when they get the documents (many often put it aside because it is many pages long). They should check all the details of themselves and the vehicle insured for correctness and similarity to what was written in the proposal form. If any discrepancies are found, the insurance company should be informed immediately. Don’t delay as your vehicle could get stolen at any time.

“There have been cases where policyholders have had their cars stolen and submitted claims with their insurance companies only to discover that they have third party coverage and not comprehensive coverage,” says Mr Lim.

In the case of third party coverage, which is cheaper, claims are only paid to other parties for their loss or damages incurred and not to the policyholder for the damage or loss of the vehicle. What Mr Lim warns of is that the motorist could have filled out the proposal form for comprehensive coverage but the salesman wrongly applied for only third party coverage.

Besides strongly urging motorists to provide accurate information and checking all relevant insurance documents to ensure that proper and correct coverage is provided, Mr Lim says that PIAM also collates the data from its members (54 at present) for statistical analysis so as to continue its work towards a fairer and more equitable motor insurance premium rating. The information is also used to identify fraud and to combat cases of fraudulent claims.