Q: What is the difference between an All Risks policy and an Equipment Insurance policy?

A: The All Risks policy covers the property insured against loss or damage by fire theft or any other accident or misfortune not otherwise excluded under the policy whereas the Equipment policy is a "named perils" policy i.e. the policy will only cover loss or damage to the insured property caused by specific perils as named in the policy such as accidental collision or overturning or collision or overturning consequent upon mechanical breakdown or consequent upon wear and tear, fire, external explosion, self-ignition, lightning, burglary, housebreaking or theft.

Q: Can I insure my motor vehicle which is licensed for use on a road and used on a road under an Equipment insurance policy?

A: "No", any motor vehicle licensed for use on a road and which is used on a road must be insured under the Motor insurance policy.

Q: How is Houseowners Insurance cover different from Fire?

A: As its name suggest, the Houseowners policy is designed to protect private dwelling premises and with this in mind the coverage is equal to that in the Fire Insurance plus additional cover like the under mentioned:

Damage to the building caused by theft or attempted theft Liability to the public in respect of accidents caused by a defect in the buildings Loss of rent (without additional premium whereas this cover is chargeable under the Fire Insurance)

As for the important comparison on pricing, the cover in the Houseowners Insurance package is rated much cheaper when compared to the same perils in the Fire Insurance (at 0.106% against 0.187% for a detached or attached house of class 1A construction).

Q: Can owner's fixtures and fittings be covered in the Houseowners Insurance?

A: Yes. The expression "Buildings of the Private Dwelling House" includes all domestic offices, stables, garages and out-buildings including fixtures and fittings therein and the walls, gates and fences around and pertaining to the premises. Examples of such fixtures and fittings that can be included are wall & ceiling lighting, air-conditioners, water heaters, built-in cabinets, built-in wardrobes and the like.

Q: My bank has taken up a Fire or Houseowners Insurance for me. Do I still need to look into adequacy of cover?

A: Yes, of course. The financial institutes may only be insuring up to the level of their interest in your property (i.e. up to the amount of the loan) and it is up to the owner to ensure no shortfall in the sum insured. Adequacy of sum insured is a very important and fundamental part of insurance granted on indemnity basis (as against "agreed value" for instance). There is always an average condition in the policy that says that if at the time of loss the actual values should be greater than the sum insured, then the Insured shall be considered his own insurer for the difference.

Don't forget, even if the financial institute has insured your property adequately, the renovations or extensions to the building and the fixtures and fittings are factors that the financiers would have no knowledge of. It is up to you to arrange such top-up insurance requirement.

Q: My apartment is insured by the Building's Management Corporation in accordance with the requirement of the Strata Title Act. Do I still need to look into adequacy of cover?

A: Under the Strata Title Act, the onus imposed on the Building Management Corporation is a heavy one. They have to arrange insurance for all units of the building inclusive of the common areas on reinstatement value (i.e. replacement or "new for old" values) under a "Master Fire or Houseowners Insurance Policy". Insurers would issue separate certificates of insurance for the individual unit owners and this would be acceptable as evidence of insurance of the units by the financiers. If the management corporation handles the insurance in the proper manner, you just need to consider the additional values you may have incorporated into your own unit e.g. enhancement like plaster ceilings, better quality flooring finishing, built-in wardrobes & cabinets, air-conditioning and the like. The Building Management would have insured the units based on the "standard" features and individual owners would have to ensure that changes to the units are handled separately on their own.

Q: I bought my house 20 years ago for RM100,000. It is now valued at RM300,000 in the market. How much should I insure the house for?

A: Unless otherwise arranged, the Houseowners policy pays the insured value or the market value of the insured property, whichever is the lower subject to any excess which the Insured is required to bear under the policy. The alternative is to arrange insurance on "reinstatement value" basis. Under this agreement, the Insurer will reinstate or replace the insured property as it was when new, ignoring the elements of wear and tear on the 20 years old house. So when setting the amount for insurance purpose, be guided first by the valuation basis of your choice. If you elect to insure on reinstatement value, base the sum insured on the cost of re-construction today, without the value of land.

Q: How is Householders Insurance cover different from Fire?

A: Like the Houseowners policy, Householders insurance is tailored made for the private dwelling premises and provides coverage for the Contents therein. Its cover is equal to that in the Fire Insurance plus additional cover like the under mentioned:

Loss of contents insured arising from theft or attempted theft. Covers contents temporarily removed from the private dwelling. Breakage of mirrors. Compensation for death of the Insured occasioned by outward and visible violence caused by thieves or by Fire. Loss or damage caused to clothing and personal effects of the Insured's domestic servants. Liability to the public in respect of accidents in or about the private dwelling house. Reasonable additional expenses necessarily incurred by the Insured at a hotel or lodging house in consequence of the premises so damaged as to render it uninhabitable.

Although the Householders Insurance package is more expensive when compared to the same perils in the Fire Insurance (at 0.398% against 0.187% for a detached or attached house of class 1A construction) the wider coverage provided makes it well worth the consideration.

Q: Can fixtures and fittings be covered in the Householders Insurance since my Bank has arranged the necessary fire insurance on the building?

A: Yes. For the benefit of policyholders, fixtures and fittings like wall & ceiling lighting, air-conditioners, water heaters, built-in cabinets, built-in wardrobes and the like can be insured under Houseowners Insurance (at a very low rate of 0.106%) but if expressly requested, insurers would be happy to cover the items under the Householders section for the appropriate (higher) rate.

Q: My bank has taken up a Fire or Houseowners Insurance for me. Can I instruct them to handle the Householders insurance as well?

A: You can ask them but it is advisable to make the insurance arrangement yourself as the Bank has no insurable interest in your house contents. It is a very simple procedure of approaching your insurance company for the proposal form and quotation.

Q: I keep jewellery in the house. Will the Householders Policy cover me for losses on my jewellery arising from theft or other perils stated in the policy?

A: Yes, the Householders Policy covers losses to Platinum, Gold and Silver Articles, Jewellery and Furs but limited to one-third of the Total Sum Insured on Contents. However, any item in this category exceeding 5% of the Total Sum Insured on Contents must be specifically declared to the insurers.

For example, a Householders policy with Total Sum Insured of RM20,000 can claim up to RM6,667 for jewellery and if any single item is valued at more than RM1,000 (being 5% of RM20,000) then the jewellery concerned must be lodged separately to the insurers beforehand, when insurance was first arranged. Failure to do so would result in your insurer only reimbursing you not more than RM1,000 per piece of jewellery at the time of loss.

Q: How much should I insure the house contents for?

A: Contents in the policy includes "household goods and personal effects of every description (unless otherwise mentioned by the Insured) being the property of the Insured or any member of his family normally residing with him whilst contained in the Private Dwelling". This definition would be the first guide.

Secondly, unless otherwise arranged, the Householders policy pays the insured value or the market value of the insured property, whichever is the lower subject to any excess which the Insured is required to bear under the policy. The alternative is to arrange insurance on "reinstatement value" basis. Under this agreement, the Insurer will reinstate or replace the insured property as it was when new, ignoring the elements of wear and tear. So when setting the amount for insurance purpose, also be guided by the valuation basis of your choice.

A reminder: If at the time of loss the value is collectively of greater value than the sum insured, the Insured shall be considered as being his own insurer for the difference.

Q: What is INCOTERMS? (International Common Trade Terms)

A: Frequently, parties to a contract are unaware of the different trading practices in their respective countries. This can give rise to misunderstandings, disputes and litigation with all the waste of time and money that this entails. In order to remedy these problems the International Chamber of Commerce published a set of international rules for the interpretation of trade terms. These rules were known as "INCOTERMS "

The purpose of " INCOTERMS " is to provide a set of international rules for the interpretation of the most commonly used trade terms in foreign trade. Thus, the uncertainties of different interpretations of such terms in different countries can be avoided or at least reduced to a considerable degree.

Q: What is FOB? (Free On Board)

A: Under this trade term, the seller is responsible to deliver the goods from his premises until loaded on board the vessel at his own cost and risk. Therefore the seller bears the risk before loading for which he can arrange inland transit cover. Thereafter the goods are at buyer's risks.

Q: What is CFR? (Cost and Freight)

A: The seller's responsibility is the same as FOB trade term. In addition he has to bear all shipping and forwarding expenses.

Q: What is CIF? (Cost, Insurance and Freight)

A: The seller undertakes to arrange and pay for all costs of delivering the goods and insurance up to final destination because the buyer has paid for these in the sale price. The insurance policy is assigned to the buyer and he can claim under the policy as though he had arranged for the insurance himself.

Q: What is Double Tax Deduction?

A: The Malaysian Government allows the local importer/Exporter to claim for "Double Tax Deduction" on premium paid for marine cargo insurance if it is insured with a locally incorporated Insurance Company such as BGI. If RM100 is paid as marine insurance premium, RM200 can be deducted as an expenses for tax deduction.

Q: Who should arrange the Marine Cargo Insurance?

A: The trade term stated on the sales contract between the seller and the buyer will determine where and by whom an import or export of goods is insured. It is therefore necessary to understand when the risk and ownership of the goods passes from the seller to the buyer under the different types of contract of sale by referring to the INCOTERMS. This is because in the event of loss of or damage to the goods, it is essential to establish which party must bear the loss and be indemnified according to the provisions of the insurance policy.

Q: Do all insurance companies charged the same premium?

A: Motor Insurance is tariff rated i.e. the premium for that cover is being computed based on a formula determined by the insurance authority, this means that all insurance companies are charging the same basic premium for the same cover.

Q: What is loading and when will insurance companies apply loading?

A: Loading is an additional surcharge imposed on the basic premium rate. Factors that may affect the risk where loading can be imposed are but not limited to age of vehicle, the driver's driving experience and adverse claims experience.

Q: What is an excess and show an example on the application?

A: An excess is the amount the Insured will have to bear before the insurance company will pay for each and every claim made. For example, if the claim amount is RM3,500 and the excess stated on the policy is RM500, the amount payable to the Insured will be RM3,500 less RM500 i.e. RM3,000.

Q: What is No Claim Discount (NCD) entitlement?

A: A NCD entitlement is a discount allowed to the Insured in accordance to a scale determine by the authority, a certain percentage off the basic premium (inclusive of loading, if any), if no claim is made or intimated under the insured's policy and also provided the vehicle is insured continuously for a period of 12 months with the same Insurer.

Q: Can I transfer my NCD entitlement from one car to another and from another insurance company?

A: Yes, if the cars are registered in your name, the transfer of NCD earned can be allowed but always bear in mind that you can only enjoy the next level of NCD if your car is insured with the same insurer continuously for a period of 12 months and provided there is no claim made or intimated under your policy in each of the above instances.

Note: You cannot use the same NCD earned to more than one cars. NCD is on earned basis by each car upon completion of the continuos 12 months period of insurance with the same insurer. You can inter-change your NCD to any car registered in your name as explained in the above.

Q: How much should I insure my car?

A: You should insure your car on market value. You can seek the motor car franchise holders to determine the value of your car.

Q: Can I insure the lives of employees?

A: Yes, you can take up a group personal accident insurance for your employees. Group personal accident insurance pays benefits to the company when the employee injures or death caused by an accident. The policy is normally owned by the company, which pays the premiums and is the beneficiary.

Q: Do I still need a personal accident insurance if I already have a life insurance?

A: Yes, you do. Personal accident insurance covers permanent disablement such as loss of sight, limbs and hearing resulting from an accident and medical expenses, which might not be covered under the life insurance.

Q: How can I nominate a beneficiary for my personal accident policy?

A: Simple, you are just required to complete a nomination form.

Q: If I have two personal accident policies, will the benefits on both policies payable?

A: Yes, it will be payable on both policies in respect of death benefit or permanent disablement benefit.

Q: Are there any exclusions in a Health Insurance Plan?

A: Yes, please refer to the Policy Exclusions as stated in the respective Health Product Exclusions.

Q: What is the role of the TPA?

A: They are the administrator of the plan for certifying eligible hospital admission according to the plan coverage and guaranteeing the eligible hospital charges. They also provide the helpline for medical advice and related services.

Q: Is there a panel of hospitals by TPA?

A: Yes, please refer to the List of Panel Hospitals.

Q: For Family Plan, how many spouses and children are allowed?

A: Only 1 legally nominated spouse and all eligible children as defined are eligible for coverage.

Q: Who is responsible to pay the ineligible expenses upon discharge?

A: The patient has to pay.

Q: What is DEDUCTIBLE?

A: A deductible is the monetary amount of incurred covered expenses that the Policy Holder or insured must bear before additional eligible benefits can be indemnified.

Q: Can I stay in a Room & Board higher than my Entitlement?

A: Yes, you may choose to be hospitalised at a Room & Board rate which is higher than your benefit entitlement. BUT the Insurer shall only bear 80% of the eligible benefits described in the Schedule of Benefits and you will be responsible for the remaining sum. So choose a Plan that best suits your lifestyle by giving you the desired coverage within your entitled Room & Board.

Q: What is Product Repricing and how will it impact the policyholders?

A: The revised premium is priced on a portfolio basis and takes into consideration the past claims experience of the whole portfolio and current private healthcare inflation. Your premiums will be pooled with other policyholders' premiums to pay claims. If the total claims paid out from the pool of fund is high, the premium for all policyholders in the same pool may increase, including your premiums even if you did not make a claim. 

We understand the importance of continuous protection, therefore repricing is necessary to ensure sustainability of the product. 

Your policy shall lapse if you choose to discontinue the coverage immediately following the expiry date of the policy. Please note that if you intend to switch your policy to another insurer or from one type of health plan to another, the Waiting Period and Specified Illlnesses exclusions may start afresh. Any deteriorating health status may also result in imposition of les favourable terms or non acceptance of application.