Excess refers to the amount that you are require to pay as per the policy terms & conditions in respect of each and every claim payable (including cost and expenditure incurred by the insurance company to conduct, defense and settlement of any claim for the loss or damage to your vehicle, and damage to third party resulted from the accident arising out of the use of your vehicle for liability to third parties), in addition to any other excess that may be applicable. For example, the excess of your policy is RM200 and the total claim amount is RM2,000. Your car insurance company will pay out RM1,800 for the claim while you have to pay the remaining RM200.
The above refers to policy excess, that is imposed by the car insurance company. Take note that there will be Compulsory Excess Fee, in situation outlined by PIAM Motor Tariff as below:
– A person with a probationer license (“L” license).
– A person with a “P” license.
– A person below 21 years old.
– A person who is not a named driver.
This compulsory Excess is fixed at RM400.
So, check your insurance policy to see if you have an ‘excess’ on your policy, and in an unfortunate event which you have to make a claim, you will have to borne part of the claim as per your excess fee. In the event that you allow anyone to drive your vehicle as mentioned above, example, anyone below 21 years old etc, and it resulted in an insurance claim, you will be responsible for the compulsory excess of RM400.