Key factors identified as impacting motor insurance purchase in a liberalized market
Consumers in Malaysia want competitive pricing, guaranteed claims approval and best turnaround time for the approval of their claims once motor insurance has been liberalized, a recent survey has found.
The survey, which polled some 4,400 respondents who were aged above 18, showed that 89% of them preferred competitive pricing for their motor insurance purchase.
Besides competitive pricing, 70% want guaranteed claims approval within 3 business days for motor insurance claims below RM5,000. Some 60% also preferred a settlement within 60 days for vehicle claims where recovery is unsuccessful.
Additionally, 64% of respondents wanted discounts and rewards for being loyal customers, while 55% opted for flexibility to customize their motor insurance plans.
Prior to making a decision to purchase motor insurance, 86% said they would research what insurers would offer, while 16% would go for insurers with the most advanced technologies and innovation. Another 69% would choose insurers that reward good driving behavior, and 39% would go for insurance companies with the best reputation.
AIG Malaysia’s Chief Executive Officer, Antony Lee, said, “This survey has displayed the true picture of customers’ expectations and knowledge about motor insurance, and the factors that make customers tick.”
“We are constantly committed to fulfilling our promise to offer the best claims turnaround time to our customers. This is clearly exemplified in AIG Malaysia being awarded the Best Insurer 2016 for best turnaround time for claims, a recognition that we have been receiving since 2011,” Lee added.
The survey also found that 42% of respondents were aware that motor insurance in Malaysia was imposed with a tariff, while a whopping 83% think motor insurance liberalization will have an impact on their motor insurance renewal.
On the modality of motor insurance purchase, the survey found that 24% preferred to purchase their motor insurance online, while the majority at 66% liked the more traditional channels, including dealing with an agent or visiting insurance branches.
Lee said, “The impending liberalization of the motor insurance market will bring new opportunities and challenges. It will be an incredibly open and competitive marketplace, where customers can shop around for the best deals, an attractive motor insurance premium, or the best insurance coverage for their prized cars. Insurers will need to highlight their unique strengths such as their claims capabilities to stay ahead of the curve.”
Bank Negara Malaysia (BNM) announced the New Motor Cover Framework in 2011 with premiums to be revised gradually from January 2012. On July 1, the second phase of the motor insurance liberalization would begin where insurance companies would be able to offer add-ons and product extensions. The first phase was implemented on July 1 last year.
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