How flexible is your auto insurance

Regardless of how much you use or don’t use your car, you still have to pay regular expenses for its maintenance and upkeep. Mandatory road tax is paid every year, for example, and you’ll likely shell out thousands for car repairs and maintenance. Carsome estimates that a brand new Perodua Myvi 1.5 SE Auto could incur maintenance costs of RM4,000 over 5 years. Your own upkeep costs will vary based on your car’s make, model, and age, as well as how and where it is driven.

Then there’s car insurance, which normally can cost hundreds to thousands of Ringgit per year. Like maintenance costs, auto insurance premiums will also vary depending on your car’s make, model, age, and more. It’s a fixed cost that poses a challenge to consumers looking to save on expenses during this economic downturn.

If you’ve been using your car less over the past few months, you aren’t alone. According to the Department of Statistics, average monthly household expenditure in Malaysia has reduced by half, and car-related costs can seem like a luxury rather than a necessity at this time. One solution to help mitigate the dent to your wallet is flexible auto insurance. The less you use your car, the less you’ll pay — while still receiving the protection you need.

Changing lifestyles require much more flexibility

Traditional auto insurance plans can be complicated, especially for people who rarely use their cars. Chubb research shows that over half of customers admit they don’t know the specific details of their insurance policy. They are also relatively inflexible, offering fixed coverage based on the dictates of the plan regardless of actual car usage. So, if you wanted to lower your expenditure, you would have to choose a plan with less coverage even if you require additional protection.

As a result, some providers have developed more flexible, easy-to-understand policies like usage-based auto insurance where customers are charged based on how much they drive their car.

Usage-based policies can deliver significant cost-savings for vehicle owners. If you are driving less, this should save you around 20% to 30% in insurance costs as compared to traditional auto insurance.

Flexible auto-insurance could be an ideal solution

There are a number of usage-based policies available in Malaysia. One such product is Chubb’s MY Smart Car Insurance, which offers three plans based on mileage tiers of 5,000 km, 7,000 km, and 10,000 km.

Flexible plans often allow you to enhance coverage with add-ons that you select rather than a one-size-fits-all solution. Some examples of popular add-ons include coverage for multiple drivers, protection from special perils, and windscreen coverage. Certain plans may even allow you to roll over unused mileage. MY Smart Car Insurance, for instance, lets you carry forward unused mileage to the next policy upon renewal—so even if you purchase too much or your circumstances change, your money isn’t wasted. On the flip side, you can also purchase a top-up in case you exceed your current limit. These options enable more control over your insurance costs.

So, if you’re someone who only uses your car occasionally to go on weekend trips or visit friends or family, then you might benefit from a flexible insurance plan.

Some of the other costs involved with owning a car—such as repair costs and petrol usage—can be mitigated and reduced with smart car ownership. If you’re feeling lost, you can always schedule a consultation with Chubb and share your average car usage to get an idea of the different add-ons and insurance options you might need with a mileage-based plan.