Motor insurance claims process will now be fairer, quicker and more transparent for all motorists – BNM

Bank Negara Malaysia (BNM) says that enhancements that have been made to the Policy Document on Claims Settlement Practices (PDCSP) will make the motor insurance claims process fairer, quicker and more transparent for all motorists.

These revisions were outlined by Lailatul Akma, deputy director of BNM’s Consumer & Market Conduct Department, in a BFM Morning Run programme broadcast earlier today. She said the changes were aimed at simplifying procedures, improving service standards and accelerating approvals for motor insurance claims.

She said the central bank has been working closely with insurers, the transport ministry, JPJ, Puspakom as well as repairers to make the process simpler and more user-friendly.

“One of the key improvements consumers can expect from the revised claims settlement practices policy document is a faster turnaround time, which sets clearer expectations for insurance providers to simplify the claim process so that consumers can benefit from fair, transparent and a timely claims outcome,” she said.

“The revised policy has reduced the timelines for each stage of the claims process from claims notification until claims payment, including how quickly insurers have to get back to you so that you are not left waiting in the dark,” she added.

“For example, the time taken for own damage claims have been reduced by 20 working days and the time to claim for theft has been reduced for about 80 working days. So we expect this will help to cut the average time taken to settle motor claims by about half,” she continued.

Lailatul said that motorists who are not at fault in a vehicle accident can claim their own insurance without risk of losing their no claim discount (NCD) under the Own Damage Knock-For-Knock (ODKFK) policy.

She said that motorists with a comprehensive policy can claim directly from their own insurer without having to fork out the repair costs or wait for the other party’s insurer to process the claim. This will allow vehicle owners to carry out repairs to their vehicles quickly. All a motorist has to do is submit a police report and other required documents to their insurer to facilitate a claim.

However, she said the ODKFK policy doesn’t apply in blanket fashion, and if the accident involves a bus or taxi or results in any injury, the affected motorist will have to claim from the party at fault’s insurer. “But for most everyday cases in accidents involving vehicles, ODKFK is a much smoother way to get your car fixed and back on the road,” she said.

She also said that all insurance companies are now required to provide 24/7 roadside assistance services, be it through their mobile applications or websites. The move is aimed at helping motorists by limiting the engagement they usually have with unauthorised tow trucks following an accident.

Lailatul said that the policy has also introduced a new requirement, where insurers are expected to establish a motor customer service charter, which should provide greater certainty and transparency to consumers on the claims process.

This, she said, spells out very clearly what kind of service you can expect when making a claim, and consumers should be able to access the charter easily as insurers are required to publish it on their website. “For example, you can find the service standard and turnaround time for the entire claim process in the charter, including applicable criteria and thresholds for expedited or fast track claims,” she said.

“So with the charter, you can hold your insurer responsible and accountable if they do not adhere to their own standards and timelines or fail to keep you informed. So at the end of the day, the charter takes the uncertainty out of ‘how long will this take’ or ‘what can I expect’ and that really empowers consumers when dealing with claims,” she added.

In cases where consumers are dissatisfied with their insurance decision, she said there were options to help address this. “The first thing you can do is complain to the insurer’s complaints unit. Their contact should be published clearly on their website as required by the complaints handling policy which we issued,” she said.

“Your insurer should also respond to you within 14 working days, and the good news is that we are shortening this to five working days from April next year,” she said.