How to Calculate Car Insurance Malaysia 2024

Calculating car insurance can seem complex, but understanding the process can empower you to make informed decisions and manage your finances effectively. In this guide, we will explain how to calculate car insurance, helping you to plan your budget and ensure you’re adequately covered.

What You Need to Know to Calculate Car Insurance?

Insurance companies use a variety of factors to determine your insurance premium, including your driving history, the type of car you drive, your age, and where you live. By familiarizing yourself with these factors and how they influence your insurance costs, you can better anticipate your expenses and take steps to potentially lower your premiums.

Here are the things you need to know to calculate car insurance:

1. Current Vehicle Price

The easiest way to find out your vehicle’s current price is by visiting buy-and-sell and listing websites. You can check the current selling price of your car or use an online calculator like the Car Market Value Calculator.

2. Vehicle Engine Capacity

There are various types of vehicle engine capacities available in Malaysia, such as 660cc, 860cc, 1,000cc, 1,300cc, 1,600cc, 1,800cc, 2,000cc, and above. To calculate car insurance and road tax, you need to identify your engine’s capacity size.

3. No Claim Discount (NCD)

The No-claim Discount or car NCD is a discount offered by insurance companies to vehicle owners as a reduction in payment. This discount is typically based on the number of years you have owned the vehicle without making any insurance claim. For example:

• First year: 25 percent NCD;
• Second year: 30 percent NCD;
• Third year: 38.33 percent NCD;
• Fourth year: 45 percent NCD;
• Fifth year and beyond: 55 percent NCD.

You can check your NCD online or learn more from about car NCD in our article here.

How to Calculate Car Insurance Cost?

Understanding how to calculate your car insurance premium is crucial for managing your vehicle expenses effectively. By using a basic formula, you can get an estimate of the costs involved in insuring your vehicle.

Basic Car Insurance Calculation Formula

Here is the basic formula you can use to calculate car insurance:

Total Comprehensive Premium = Gross Premium + Additional Coverage (if any) + 6% SST + Stamp Duty

Let’s break it down:

• Gross Premium: This is the base cost of the insurance policy;
• Additional Coverage: This includes any optional add-ons you may choose, such as windscreen coverage or coverage for natural disasters;
• Six (6) percent SST: This is the Sales and Service Tax applied to the gross premium and additional coverage;
• Stamp Duty: This is a fixed charge applicable to the insurance policy.

For example, consider a Perodua Axia 1.0 G with a coverage amount (agreed value) of RM31,000.

Calculation Steps

Let’s use the provided details to calculate the total comprehensive premium for a Perodua Axia 1.0 G.

1. Calculate the NCD Discount

• • • Basic Premium: RM976.95
    • NCD (45%): RM976.95 * 0.45 = RM439.63 (discount)

So, the Gross Premium after NCD: RM976.95 – RM439.63 = RM537.32

2. Add Additional Coverage

• • • Additional Coverage: RM120

Gross Premium including Additional Coverage: RM537.32 + RM120 = RM657.32

3. Add Service Tax (6%)

• • • Service Tax: RM657.32 * 0.06 = RM39.44

4. Add Stamp Duty

• • • Stamp Duty: RM10

5. Total Comprehensive Premium

• • • Total Premium: RM657.32 + RM39.44 + RM10 = RM706.76

Thus, the total comprehensive premium you need to pay is RM706.76 To get an accurate quote, you would need to contact an insurance provider or use an online calculator, as the gross premium and additional coverage options can vary between providers.

Compare Car Insurance, and Choose the Right Coverage for A Peace of Mind

Now that you know how to calculate car insurance, it’s important to understand that the information provided is just a general guideline. The actual amount you need to pay may be slightly higher or lower depending on the insurance company you choose.

Therefore, as consumers, it is essential to make comparisons before deciding on the appropriate coverage. Each insurance or takaful company offers different insurance prices and benefits. We hope this guide on how to calculate car insurance is useful to you.

To know more about car insurance, visit qoala.my for more info. Qoala is an insurance platform that allows you to compare and choose affordable car insurance from several top insurance companies. The process of renewing car insurance can be done more quickly and securely with just a few simple steps!