What is an excess?
Are there any restrictions on buying motor insurance for people with a probationary driving license?
What should I do if I am involved in a traffic accident?
According to the Motor Vehicles Insurance (Third Party Risks) Ordinance, any persons, including the vehicle owner and other drivers, who use a motor vehicle on road, are responsible for ensuring having a valid third party risks insurance policy for the vehicle. If there is an accident, the driver or owner may be liable for repair or replacement of the car and for compensation to a third party for property damage, bodily injury or death. Motor insurance is designed to cover these losses.
Product features
Reminders
Choose the intermediary carefully
- Some auto dealers provide insurance intermediary services. Check the identity of the intermediary to ensure they are authorized by the Insurance Authority via the Register of Licensed Insurance Intermediaries of the Insurance Authority.
- Insurers require the policyholders to list all “named drivers”. Many of them specify a minimum age requirement of the policyholder and 'named driver' on the policy. The minimum age is normally 25. You can apply for a motor insurance policy if you are under 25, but the selection of insurers is more limited, and the premium may be relatively high.
- Most motor insurance policies have an excess, which is the initial amount of a claim that you must pay yourself. The amount of the excess may vary depending on the type of vehicle, the age and experience of the drivers, etc. In normal situations, a young (under 25 years old) and inexperienced driver (having a driving licence for less than two years, such as those having a probationary driving license) has to pay for the excess according to the policy terms.
- Most motor insurance policies provide a no-claim discount (NCD) or no-claim bonus (NCB) on the premium if the policyholder does not make a claim during the policy year, subject to a maximum limit. Generally, the longer the claim-free period, the higher the NCD or NCB. Some insurers allow policyholders to transfer their NCD or NCB from another policy, but the policyholder must provide relevant proof to the new insurer.
- Allow sufficient time for renewal, including soliciting quotations from different insurers. If you are going to change your policy, you must accurately declare your NCD and accident history, and provide relevant proof.
- Vehicles are insured based on their market value, which is affected by the car type and age. However, motor policies exclude liability in respect of depreciation, and wear and tear. Claims are approved only after consideration of the age, depreciation and market value of the vehicle.
- If you are involved in a traffic accident, report it to the police and your insurer immediately, no matter how minor the accident is. Do not hide the truth to protect your NCD or NCB. Some insurers may allow you to apply to recover your NCD or NCB if you do not eventually make a claim. If you are in doubt, consult your insurer as soon as possible.
