New Motor Cover Framework Finally Comes
When I worked with composite insurance companies (i.e. doing both life insurance and general insurance) some years ago, I involved in analyzing claim experience for each product line and calculating IBNR (Incurred but not reported) reserves. Every time I looked at the terrible loss ratio of “Motor (ACT)” and “Motor (Others)” classes, I would pray for the detariff of motor insurance premium rates coming as soon as possible. I’m glad to hear Bank Negara Malaysia’s (BNM) announcement via its press release on 6 January 2012, revealing the New Motor Cover Framework. According to the press release, the gradual revision in the Motor Tariff premium rates will be implemented effective from 16 January 2012, over a period of four years (2012 to 2015). The Framework will pave the way for detariffing of the motor insurance premiums in 2016, in which premium rates will be further differentiated in accordance to the risk profile of individual vehicles and fairer to vehicle owners as those with good...