There is a tendency for insurance companies or their agents to suggest a higher than market value as insured sum, or at least that is my perception. The obvious and immediate advantage to them is the higher premium and related commission, but in the event of a claim, then it can be a disadvantage having to pay out more, depending on the way it is assessed.
We had the pleasant experience before (other than the theft and the trouble in making police report) of obtaining a full compensation of the sum insured when we lost the company's Ford Courier. My wife had the insulting experience of having to answer queries from an investigator asking about her husband's occupation which implies the possibility of collusion!
If you own a Nissan car bought from Tan Chong Motor, then they will advise you to continue buying motor insurance from them (they promise a new car replacement if stolen within the first year), because they guarantee 100% compensation of the sum insured in case of theft. We did not insure our Navara for windscreen and it was damaged months ago. When I enquired, the repair cost was Rm3,300 as compared with a non original windscreen and repaired elsewhere of about Rm600! It has since been reduced to Rm2,200. But based on the original quote, the insurance premium at 15% would cost Rm495 which is almost that of a replacement elsewhere. In a way, we were lucky we did not have an expensive tint done when new which would have costed over Rm1,000.
I have just received a reminder from Lonpac for renewal of motor insurance for daughter's Accent and it was so obvious that the rationale was just as what I had described in my first paragraph. I had reduced the sum insured for the previous year to Rm18,000. Now, instead of my estimate of Rm15,000, the company had suggested Rm21,000! How we wish that is the current market value! The difference in premium based on their valuation and mine, with a NCD of 30%, is around Rm100. If we can be assured of a 100% compensation in case of theft, then it is a small price to pay, after all it is based on their valuation not ours.
I can still remember when I had to insure a minimum sum of Rm10,000 for my old BMW 728i on a comprehensive policy, I wished it had been stolen because of its very low resale value! 'Please take me' could have been placed on the car and left at a high risk location! I am still fond of the car but because it was underused, the Rm1,600 annual road tax made it wasteful. It is ridiculous if I had to use it just to make it worthwhile and maintain the battery. In a way I saved Rm8,000 for the past 5 years it had been shelved, and the price? Just a bit of dent in my ego but it is a nicer feeling for not being wasteful.
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We had the pleasant experience before (other than the theft and the trouble in making police report) of obtaining a full compensation of the sum insured when we lost the company's Ford Courier. My wife had the insulting experience of having to answer queries from an investigator asking about her husband's occupation which implies the possibility of collusion!
If you own a Nissan car bought from Tan Chong Motor, then they will advise you to continue buying motor insurance from them (they promise a new car replacement if stolen within the first year), because they guarantee 100% compensation of the sum insured in case of theft. We did not insure our Navara for windscreen and it was damaged months ago. When I enquired, the repair cost was Rm3,300 as compared with a non original windscreen and repaired elsewhere of about Rm600! It has since been reduced to Rm2,200. But based on the original quote, the insurance premium at 15% would cost Rm495 which is almost that of a replacement elsewhere. In a way, we were lucky we did not have an expensive tint done when new which would have costed over Rm1,000.
I have just received a reminder from Lonpac for renewal of motor insurance for daughter's Accent and it was so obvious that the rationale was just as what I had described in my first paragraph. I had reduced the sum insured for the previous year to Rm18,000. Now, instead of my estimate of Rm15,000, the company had suggested Rm21,000! How we wish that is the current market value! The difference in premium based on their valuation and mine, with a NCD of 30%, is around Rm100. If we can be assured of a 100% compensation in case of theft, then it is a small price to pay, after all it is based on their valuation not ours.
I can still remember when I had to insure a minimum sum of Rm10,000 for my old BMW 728i on a comprehensive policy, I wished it had been stolen because of its very low resale value! 'Please take me' could have been placed on the car and left at a high risk location! I am still fond of the car but because it was underused, the Rm1,600 annual road tax made it wasteful. It is ridiculous if I had to use it just to make it worthwhile and maintain the battery. In a way I saved Rm8,000 for the past 5 years it had been shelved, and the price? Just a bit of dent in my ego but it is a nicer feeling for not being wasteful.
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