5 Key Factors That are Taken into Account When Assessing Risk Profile

December 28, 2018 | Author: | Posted in Insurance

Risk profiling is nothing more than an assessment of the risk to be insured in the event of an accident when claims are made from the insured risk. As per the motor insurance policies in Malaysia, various factors are considered while calculating the risk profile of the individual. This helps the insurance company in determining the rate of the premium to be charged.

In 2016, the insurance news in Malaysia introduced the phased liberalisation of motor and fire insurance policy. The detariffication has offered insurance companies a much needed flexibility and freedom to charge premiums based on their insurance risk assessment unlike previously when they had to rely on the fixed tariff based premiums.

Some of the factors taken into account for insurance risk assessment are:

1. Age of the vehicle

It is important to consider that older cars are subject to more wear and tear as compared to a newer ones. The mileage will be reflected in its need for more repairs, part failures, and breakdowns. This might result in accidents. Thus, the owner of an old car will have to pay a higher premium as it is more prone to accidents.

2. Age of the driver

Another factor to be taken into consideration is the age of the driver. It is a fact that younger drivers are more prone to accidents and many studies have shown statistics that most serious accidents are recorded by drivers between the age group of 17 to 23 years. However, this risk profile also reverse with passing time. When the drivers are too old, the risk-profile also increases as their reflexes slow. Apart from that, there are many other factors which can cause accidents, such as health issues like dementia, cardiac diseases, and Parkinson’s’.

3. Gender of driver

It might come as a surprise but the gender of the driver also impacts the premium you pay. It has been noticed that female drivers are more careful and cautious compared to their male counterparts who can be quite reckless. Thus, males and females driving same car might be charged different premiums.

4. Claim record

The claim record of an individual is also a point of concern for the insurers. A person who has been involved with several accidents and has made many insurance claims in past is also considered as a high-risk. They will then be charged a higher premium than a driver with clean history.

5. Location

Some companies also take your location while determining the insurance premium. If you live at a location that is prone to accidents or high-traffic, you might be charged higher premiums.

Search the web for more information and suggestions on the benefits of phased liberalisation.

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About Author
Robinson James is an automobile marketing professional and he is known for offering free advice on motor and insurance risk assessment. He offers honest advice regarding auto insurance and car insurance policies through his blogs and shares latest insurance news in Malaysia to help innocent customers in making wise decisions when buying insurance plans. He can help you in choosing the best motor insurance plans at better prices.


PIAM Insurance makes the renewal of your motor & car insurance more reliable and offer the best insurance policy online in Malaysia.

This author has published 14 articles so far.

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