FREQUENTLY ASKED QUESTIONS (FAQs) ON LIBERALISATION OF THE MOTOR TARIFF
1. What is a motor insurance/takaful tariff?
Tariffs are sets of fixed price list created under insurance acts to streamline and control premium charges and policy wordings. The tariffs by virtue of regulatory guideline are also made applicable to takaful.
Examples of these are Motor and Fire insurance/takaful policies. When premiums/takaful contributions are tariffed, insurance companies/takaful operators are not allowed to vary the prices chargeable/contribution amount required on the insurance policy/takaful certificates.
2. What does the liberalisation of motor insurance/takaful mean?
The liberalisation of motor insurance/takaful means that the price of motor insurance/takaful products will no longer be determined based on Motor Tariff (a set fixed price list). Pricing will be determined by individual insurers and takaful operators.
Consumers will now be able to enjoy a wider choice of motor insurance/takaful products at competitive prices as liberalisation encourages innovation and competition among insurers and takaful operators.
Insurers and takaful operators are able to charge premiums/determine takaful contributions that are in line with broader risk factors inherent in a group of policyholders being insured/certificate holders being covered; and also market new products that are not defined under the tariff.
Kindly refer the full version here: Frequently Asked Questions