What are the types of vehicle insurance in Malaysia?
Owning a car does not only mean having your name as the owner of the vehicle. You need to know about road tax and insurance as well. So before you buy any vehicle, whether it is new or used, take note of the 3 main types of vehicle insurance in Malaysia because it is compulsory to have this before you can get a road tax for your vehicle to be ‘legal’ in the country.
The 3 types of insurance policies used for vehicles are First Party, Third Party and All Rider’s policies respectively. All Riders’ Policy is mainly used for motorcycles while First and Third Party ones are used for most vehicles. The policies are applicable for the whole of Malaysia while it usually covers Singapore and Thailand.
First Party Policy- Sometimes referred to as a Comprehensive Policy which covers loss of the vehicle duet to theft. In this situation, the insurance will usually not cover a full 100% of the price of the vehicle. Instead, it will be about 80 to 85% depending on the valuation.
Besides that, this policy will cover damages to one’s vehicle and damage to the party which was involved in the accident of the owner’s vehicle. Damages to the windscreen in the front and the rear and other glass panels are covered as well. The insurance policy will cover injuries suffered by pedestrians, cyclists and motorcyclists or other parties in the accident.
Third Party Policy- this policy is more popularly used for old vehicles like the first and second generation Hondas or Protons. In most cases, it does not cover loss or theft of the vehicle which is why this policy is usually cheaper. However, it can cover the damages and injuries as mentioned in First Party Policy.
Another aspect which must be known is that a Third Party Policy can be converted into a First Party policy with a higher premium.