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Do You Know Why Your Car Insurance is Expensive?

Updated 08 Jan 2019 – By Loanstreet


You might be wondering, “Why is my car insurance so expensive?”. This is a fair question to ask since more and more people are now looking for affordable or low-cost car insurance. That being said, many of us are still not aware of the aspects that could result in a pricier auto insurance, which is determined by your risk profile. So, let’s take a look at the factors that affect car insurance rates in Malaysia

 

1. Sorry Men and Young People, You Have to Pay More

Gender and age factors are part of your risk profile. This may sound unfair, but your insurer will take these aspects into account. Based on the number of road fatalities in Malaysia, youths, first-time drivers and men are more likely to get into road accidents. 

With these statistics, your insurance provider will calculate the probability of you claiming the insurance and adjust your rates accordingly. Bottom line is... young drivers between the age of 16 and 25 will have to pay a higher premium than other experienced drivers on the road. The same goes for male drivers.

 

2. City Drivers, We Have Bad News

Urban living has its disadvantages. A look into the annual Transport Statistics shows that Selangor, Johor and Wilayah Persekutuan have the highest number of road accidents. All thanks to the congested roads and busy highways, these states recorded a high frequency of accidents, traffic violations and vandalism.

Guess which states have the least number of road accidents? You guessed it, the rural states. Perlis, Terengganu and Kelantan recorded lesser accidents than the populated states. In places where the likelihood of accidents is lower, the premiums are lesser.

 

3. Saved Money From Buying an Old Car? Well, Not Quite

Have you wondered why car owners are paying more premium than other vehicles? Yes, the chances of road accidents have something to do with it. The statistics are clear that motorcars are involved in more road accidents than four-wheel drives, lorries and vans. Wait, there’s more.

Just when you think you’re saving money from purchasing an old car, you’re likely to pay a higher premium. The reality is, old cars are considered high risk on the road. Outdated safety features and vehicle failure probability are some of the reasons why. In some cases, old cars are not eligible for insurance too. If your car is above 15 years old, a third party car insurance policy such as Malaysian Motor Insurance Pool (MMIP) will keep your car protected.

 

4. Rebel on the Road? You’ll Pay the Price

Remember when your parents told you to drive safely? If you behave like a reckless rebel on the road, expect to pay the price in your premium. Generally, insurance companies will look into your driving record to see if you’re a high-risk driver. As you know, higher risk equates to a higher premium.

Before finalising the details of your premium, insurance companies will review every traffic violation, summon, and past accident. If you’ve been careful on the road, that’s great! To maintain a clean driving record, remember to obey the traffic rules, drive within the speed limit and stop answering phone calls while driving. Your girlfriend or boyfriend can wait.

 

5. Proton Owners, Blame the Thieves

Unfortunately, there are certain things that we can’t avoid such as the likelihood of your car being stolen. In Malaysia, certain car models are highly targeted by thieves.

A news article once shared that the Proton Wira and Toyota Hilux are unfortunate favourites. Other models such as Proton Iswara, Perodua Myvi and Proton Waja also made it into the list of High-Risk Theft Vehicle. It’s rather regrettable since these cars are popular for their affordability. If you own any of these cars, you can see why you’re paying a higher premium than most.

 

6. Like Add-Ons? Okay, Add More Cash

It’s natural to like add-ons but dislikes the additional costs. When it comes to car insurance premiums, they’re no different. All insurance companies provide a range of attractive and valuable add-ons. If you have extra money, you should take advantage of it.

Let’s take Zurich’s Z-Driver, for instance. Aside from the comprehensive coverage, did you know they offer generous discounts? If you practice safe driving, you can score 10% off on your motor premium. On top of that, there are also discounted voluntary excess and affordable water damage coverage.

In the likelihood of theft or accident, their unlimited use of a courtesy car will put your mind at ease as well as the Personal Accident coverage. For the price you pay, it’s a win-win situation if you ask us.

 

All in All, Don't Forget to Make Comparisons

We know that car insurance can be expensive, but it’s an investment for your road safety. What would you do if your car is stranded on the highway or caught in a flood? Most of the time, your car insurance will save you. To make the most of your Ringgit, compare prices and get immediate free quotes from Loanstreet's latest portal! That way, you’ll find a premium that matches your driving needs and budget!

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