I REFER to the letter “Unfortunate victim of motor policy” by Stamina Yeoh (The Star, June 28) and would like to offer my perspective on this aspect of motor insurance. Malaysia is a common law jurisdiction whereby a claim in negligence is assessed on the basis of indemnity, i.e. a loss is made good by theoretically putting the claimant back into the same position as if the event had not happened. In Stamina’s case, his car was hit from behind and he therefore filed a claim against the driver who hit him. His claim was accepted on 100% liability. The basis of his grievance is that “betterment” was applied in computing his damage repairs.
The concept of “betterment” is to discount for age, wear and tear, so as to put his car in the same condition as it currently is, i.e. a five-year-old car. If betterment had not been applied, he would be receiving more than indemnity.
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