Plenty of drivers just copy last year’s number when they renew insurance. Easy, but not smart. The thing is, calculate your car’s market value before you decide coverage is what really matters. If you over-insure, you’ll pay more for nothing. If you under-insure, you’ll hate yourself when the payout comes up short.
Why Market Value Matters
Market value is basically what your car would sell for right now. Doesn’t matter what you think it’s worth, insurers only go by that. They won’t pay above it. Example: car worth RM40k but you cover RM50k. Payout still RM40k. Congrats, you just donated extra to your insurer.
What Counts As Market Value?
It’s the open market price. Depends on age, brand, model, mileage, condition, even how well you kept service records. Every car tells a different story, so the value shifts.
How to Figure It Out
- Check PIAM or JPJ tables – simple starting point.
- Use online platforms – MyEG, Bjak, insurer sites spit out estimates once you key details.
- Browse ads – Mudah.my, Carlist, see what people are actually asking.
- Think about your car’s state – low mileage, new rims, spotless interior? That can bump it up.
- Ask a dealer or workshop – they deal with trade-ins daily and usually have a fair sense of price.
Premium Example
Say your car’s worth RM40k. Premium rate 2.5%. Base premium: RM1,000.
- Insure at RM50k → premium RM1,250 (wasted cash).
- Insure at RM30k → premium RM750 (cheap, but weak payout).
Feels okay at first, but when you make a claim, reality hits and you realize why the math matters.
Over-Insured vs Under-Insured
| Situation | Market Value | Coverage | Result |
|---|---|---|---|
| Over-Insured | RM40k | RM50k | Premium higher, payout max RM40k |
| Under-Insured | RM40k | RM30k | Payout cut, insurer pays less |
Tips To Nail It
- Stick to 90–100% of market value.
- Don’t go too low just to “save.”
- Compare across platforms.
- Recheck every year since cars lose value.
- Still confused? Call an agent or ask your insurer.
Wrapping Up
Bottom line: Calculate your car’s market value before picking a coverage amount saves money and stress. Take five minutes, run the checks, and you’ll thank yourself when claim time comes.
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