THE CONSEQUENCE IF A VEHICLE IS UNDERINSURED

Let say Sum Insured : RM 30,000

Market Value : RM 50,000
Amount Of Loss : RM 10,000

RM 30, 000
 RM 10, 000 = RM 6,000
RM 50, 000

From the example above, the sum insured of a vehicle is much lower than its market

value. At time of loss, AIG General Insurance (Malaysia) Berhad and any other

general insurance companies in Malaysia will only bear RM 6,000 instead of RM

10,000. In other words, the policyholder has to bear RM 4,000 himself. If he doesn’t send

his car to AIG panel workshops, he has to bear RM 4,300 (an excess of RM 300, 1 % of

RM 30,000). This RM 300 is not applicable if he sends his car to AIG panel workshops.