How to Read a Product Disclosure Sheet (PDS) for Car Insurance
A Product Disclosure Sheet (PDS) explains what your car insurance covers, what it excludes and what you may need to pay when making a claim. Before buying or renewing car insurance, check the coverage, exclusions, excess, claim limits and policy conditions, not just the price. Insurers may present this information differently, so knowing which sections to check can help you compare policies more confidently.
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What is a product disclosure sheet?
A PDS summarises an insurance product's main benefits, costs, risks and conditions. It is a useful starting point, but may not include every detail. Read it alongside the policy wording, schedule and applicable endorsements to understand your full coverage.
What should you check in a car insurance PDS?
| PDS section | What to look for | Why it matters |
|---|---|---|
| Type of cover | Comprehensive, Third-Party, Fire and Theft (TPFT), or Third-Party Only | Shows the general scope of protection |
| Benefits and coverage | Accidental damage, third-party liability, theft and other listed benefits | Helps you understand what the policy may pay for |
| Sum insured | The amount used to insure your vehicle | An unsuitable amount may affect how a claim is settled |
| Exclusions | Situations, losses or uses not covered | Helps you identify gaps in protection |
| Excess | The amount you may need to pay towards an eligible claim | Affects your out-of-pocket costs |
| Price and charges | Insurance price, applicable fees, taxes and other charges | Helps you understand the total amount payable |
| Add-ons and endorsements | Optional benefits, eligibility and conditions | Shows whether extra protection is available and what it covers |
| Claims procedure | Reporting requirements, documents and steps | Helps you understand what to do after an accident |
| Important conditions | Driver eligibility, permitted vehicle use and other restrictions | Helps you check whether the policy suits your circumstances |
For example, Third-Party Only cover generally will not pay for damage to your own car after an accident you caused. Always check the specific product's PDS for the benefits included.
Check the type of car insurance
The type of cover determines the general protection available under your policy.
| Type of cover | General protection |
|---|---|
| Comprehensive | Covers eligible damage to your own vehicle and third-party liabilities, subject to the policy terms |
| Third-Party, Fire and Theft (TPFT) | Covers third-party liabilities and specified losses involving fire or theft, subject to the policy terms |
| Third-Party Only | Covers eligible third-party liabilities, but generally not damage to your own car |
For example, if you want protection for damage to your own car after an accident that you caused, Third-Party Only cover generally will not provide it.
Check the PDS to confirm the benefits included in the specific product rather than relying on the policy type alone.
Understand the sum insured
The sum insured is the amount used to insure your vehicle. Your policy may use one of two valuation methods:
- Agreed value
The amount agreed between you and the insurer when the policy starts, subject to the policy terms.
- Market value
The vehicle's value at the time of loss, determined according to the policy's valuation provisions.
The settlement amount for a stolen or written-off vehicle depends on the valuation method and policy terms. Underinsurance may also trigger an average clause, which can reduce the amount payable for a claim.
Check the valuation method, sum insured and any underinsurance conditions. Read BJAK's sum insured guide for more information.
Read the exclusions carefully
Exclusions explain when your insurer will not provide cover. Depending on the policy, they may include:
- Normal wear and tear or mechanical breakdown.
- Driving without the required valid licence.
- E-hailing use without the required cover.
- Losses or damage specifically excluded by the policy.
- Undeclared accessories or modifications that do not meet the policy's requirements.
These are examples, not a universal list. Check your own PDS for the exact exclusions and restrictions.
If you drive for an e-hailing platform, confirm that your policy permits paid passenger trips and whether an endorsement is required. Read BJAK's e-hailing insurance guide.
Understand excess and other out-of-pocket costs
An excess is the amount you may need to pay towards a claim. The amount may vary depending on the policy, driver or circumstances.
For example, if an approved repair costs RM3,000 and an excess of RM400 applies, you may need to pay RM400 while the insurer considers the remaining eligible repair cost. This is an illustration only; the final amount payable depends on the policy terms and any other applicable deductions.
Also check for betterment charges and other non-covered repair costs, which may increase your expenses beyond the excess.
Check add-ons and their limits
Add-ons provide extra protection but may have separate limits, exclusions and eligibility requirements. Check the terms for each add-on, such as:
| Add-on | What to check |
|---|---|
| Windscreen cover | Benefit limit and whether recalibration or related costs are included |
| Special Perils | Covered natural disasters and applicable limits |
| E-hailing cover | Eligible platforms, coverage period and permitted use |
| Tyre and rims cover | Covered damage, claim limits and depreciation |
| Personal accident or daily hospital income | Eligible persons, benefit amounts and claim conditions |
Do not assume every add-on is included in comprehensive insurance or that all related expenses are covered. Check the individual terms and compare car insurance options on BJAK to review available benefits.
Understand the claims process
Check the PDS for reporting deadlines, required documents, notification channels and repair arrangements. After an accident, you may need to:
Stay safe
Ensure everyone is safe and contact emergency services if necessary.
Record the accident
Document the damage and collect accident details.
Report and notify
Make the required police report and notify your insurer within the applicable timeframe.
Submit your claim
Submit the claim form and supporting documents.
Follow the insurer's instructions
Follow the insurer's assessment and repair instructions.
Requirements vary by incident and claim type. Read BJAK's car insurance claim guide for more details.
PDS vs policy wording: what is the difference?
These documents serve different purposes:
| Document | Main purpose |
|---|---|
| Product Disclosure Sheet (PDS) | Summarises key benefits, costs, exclusions and conditions |
| Policy wording | Provides detailed terms, definitions, conditions and exclusions |
| Policy schedule | Records details of your cover, such as the insured vehicle, coverage period, sum insured and selected benefits |
If the PDS does not answer your question, check the policy wording and schedule. Ask your insurer to clarify any unclear conditions before purchasing.
Frequently asked questions
No. The PDS summarises key product information, the policy wording contains detailed terms, and the schedule records details specific to your cover.
Yes. Review it before buying or renewing your policy to understand the coverage, exclusions, costs and conditions.
Not necessarily. Your price depends on factors such as your vehicle, coverage, add-ons and insurer. Check your quotation and payment summary for the amount payable.
No. Comprehensive insurance still has exclusions, conditions, limits and possible out-of-pocket costs. Read the PDS and policy wording to understand your protection.
Ask your insurer or authorised representative to explain how it applies to your circumstances. If possible, get clarification in writing before purchasing.
Compare car insurance with BJAK
Reading the PDS helps you look beyond the price and understand the protection you are buying. Compare coverage, sum insured, exclusions, excess and add-ons before choosing a policy.