Does Bank Negara control how much my car insurance costs?
Not directly. Since 1 July 2017, insurers and takaful operators have set their own prices for comprehensive and third party, fire and theft cover. Bank Negara Malaysia (BNM) regulates the insurance industry, while standard rules such as the No Claim Discount (NCD) structure continue to apply.
- Insurers set the price. Comprehensive and third party, fire and theft prices can differ between providers, even for the same car.
- Basic third party cover is different. It remains subject to tariff-based rates.
- NCD is standard. The same NCD structure applies across insurers and your entitlement moves with you when you switch.
- BNM regulates the industry. It supervises insurers and sets regulatory requirements, but does not decide your individual insurance price.
What BNM does and does not set
Insurers set prices for most motor insurance
BNM introduced motor insurance liberalisation in stages. From 1 July 2016, insurers and takaful operators could offer new motor products and add-on covers with market-based pricing.
From 1 July 2017, pricing for comprehensive and third party, fire and theft cover was liberalised. Each provider can now determine its own prices based on its risk assessment.
Basic third party cover remains tariff-based
Unlike comprehensive and third party, fire and theft policies, third party-only insurance remains subject to tariff-based rates.
This means its pricing is not fully determined by individual insurers in the same way as liberalised motor insurance products.
NCD is the same across insurers
The NCD structure remains standard across insurers and takaful operators. For private cars, the discount can reach 55% after five consecutive claim-free years.
Your NCD entitlement is also transferable when you switch providers. Check your entitlement using the BJAK NCD checker.
What BNM still regulates
Insurance industry supervision
BNM licenses and supervises insurance companies and takaful operators. They must operate within the regulatory requirements set for the financial services industry.
Fair treatment of consumers
Insurers and takaful operators must follow BNM's fair treatment requirements when dealing with customers. These requirements cover how financial service providers communicate with and treat consumers.
Standard NCD rules
Although insurers set their own prices for liberalised motor insurance, the NCD structure remains consistent across providers. Switching insurers does not mean losing your existing NCD entitlement.
Why insurers quote different prices
Each insurer assesses risk differently
Insurers use their own risk assessment methods when calculating prices. They may consider factors such as your driving experience, claims history, vehicle type and safety features. This is why two insurers can offer different prices for the same vehicle and driver.
Your sum insured and vehicle value
A higher sum insured can result in a higher price. Your quote may also differ depending on whether you choose market value or agreed value.
Add-ons and coverage
Additional protection, excess and included benefits can affect your total price. Check what each quote includes before deciding which one offers better value.
Read more about why one insurance quote may be cheaper than another.
How to get a fair price
Compare several insurers. Check prices for the same vehicle and coverage using BJAK's insurer comparison.
Check your NCD. Make sure the correct discount appears in every quote.
Choose the right sum insured. Use a value that reflects your car's worth to avoid overpaying or being underinsured.
Compare similar coverage. Check add-ons, excess and valuation before comparing the total price.
Start early. Compare options before your renewal date. See how to renew car insurance.
If you think your price is unfair
Ask your insurer to explain
Contact your insurer and ask which factors affected your price. Check that your vehicle details, claims history, NCD and sum insured are correct.
Contact the complaints unit
If you are unhappy with the response, submit a complaint to your insurer's or takaful operator's complaints unit. Keep a copy of your quotation and any communication for reference.
Contact BNMLINK
If you have concerns about an insurer's conduct or how your complaint was handled, you can contact BNM through BNMLINK. Call 1-300-88-5465 or submit your enquiry through BNMLINK online.
BNM does not set your individual insurance price, but it oversees the industry and handles consumer enquiries about financial service providers.
Frequently asked questions
No. BNM does not set individual prices for comprehensive or third party, fire and theft policies. Each insurer determines its own prices, so comparing quotes can help you find a suitable option.
Your insurer may have changed its pricing, assessed your risk differently or adjusted the price based on your vehicle and claims details. Changes to your sum insured or NCD can also affect the total. Ask your insurer for an explanation.
No. Your NCD entitlement remains transferable when you move to another insurer or takaful operator. The NCD structure is standard across providers.
You can also learn about NCD relief and NCD protector add-ons.
Bjak Sdn. Bhd. is listed on BNM's approved financial adviser list. Find out more about whether BJAK is regulated by Bank Negara Malaysia.
Compare before you pay
BNM regulates the industry, but insurers set their own prices for most motor insurance policies. Comparing quotes helps you find coverage that suits your car and budget.
- Last reviewed:
- 3 Nov 2026
- Reviewed by:
- Compliance
- Next review:
- 1 Jan 2027