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Is my car insured according to current market value? How much should I insure it for? Have I underinsured or overinsured my vehicle?

These are some of the recurring questions that continue to plague motor policyholders when the time comes to renew their annual motor policies. 
 
Allianz General Insurance Company (Malaysia) Berhad (Allianz General) recommends that private car owners insure their vehicles based on the company’s Agreed Value system to ensure reliable protection and peace of mind. 
 
“The Agreed Value is the amount agreed by Allianz General and the policyholder for the car insured (based on underwriting requirements) while the market value is the current value of the vehicle in the market. If you insure your car based on Allianz Agreed Value, we will honour that amount even if the market value of the vehicle is lower in the event of theft or total loss,” says Zakri Khir, Chief Executive Officer of Allianz Malaysia Berhad and Allianz General Insurance Company (Malaysia) Berhad.
 
Zakri explained that if a vehicle is insured based on the market value, the claimant will only receive the amount equivalent to the current market value of the vehicle at the time of loss and this is usually much lower due to depreciation of the car.
 
“For example, if your vehicle is insured for RM95,000 under our Agreed Value and the market value drops to RM80,000, we will still pay you the full RM95,000,” said Zakri, adding that the insured are actually protected over the depreciation value of the vehicle.  Furthermore, policyholders do not have to worry about underinsuring their vehicles.
 
Zakri clarified that the Agreed Value only applies for private cars and there are terms and conditions that first need to be met before the Agreed Value is offered to the policyholder.
 
“Ensuring the right cover for your car is important and we would like to see more of our policyholders insure their vehicles based on the Agreed Value,” he said, adding that private car owners need to be aware that there is an option for them and choose an insurance company  with a proper Agreed Value system in place.
 
Allianz General is among the very first insurers to offer customers Agreed Value for their motor policies. To date more than 50% of the company’s private car policyholders have insured their vehicle based on the Agreed Value system.

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