Higher take-up seen this year for flood damage cover in motor insurance policies

KUALA LUMPUR: More Malaysians have added flood damage cover to their motor insurance policies this year compared to 2021.

The General Insurance Association of Malaysia (PIAM) said an increase of consumer awareness of flood damage risks led to the take-up rate more than doubling to 12% this year from 5% the previous year.

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It said in a statement on Wednesday (Dec 28) that the Special Report on Impact of Floods in Malaysia 2021 issued by the Statistics Department reported overall losses of RM6.1bil from the floods that hit several states in December last year and early January.

"Flash floods in Malaysia have caused much damage to property and losses to people nationwide.

"With the year-end monsoon season picking up its pace in December this year, more floods are inevitable," the statement said.

PIAM said other increases involved fire (material damage) cover which saw a slight bump to 31% in the first half the year, against 30% for the whole of last year.

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The statement said all PIAM member companies offer an extension for flood coverage under their motor and fire policies with an additional premium and at the individual insurer’s underwriting discretion.

"Consumers are advised to review their policies and check on the coverage offered with their intermediaries... as the coverage, terms and conditions may differ between one insurer and another," PIAM said.

The statement added that the flood coverage add-on for motor insurance was more affordable now, and based on three different types of vehicles.

It noted that the additional premium for flood extension coverage ranged from 8sen to RM1.74 a day.

PIAM also encouraged policyholders to review their existing insurance coverage to ensure their assets are safeguarded against floods, fire and other disasters.