What should I know about car insurance when buying on hire purchase? Can my bank insist that I insure with an insurance company on its panel?

Your banking institution will arrange for an insurance cover for the motor vehicle for first year.

For subsequent years, you will need to get the insurance yourself.

In practice, most banking institutions would need a comprehensive insurance policy on the motor vehicle.

You can either insure with an insurance company on the panel of your banking institution or an insurance company of your choice.

Normally, a banking institution has at least four insurance companies on its panel for the convenience of its hirers.

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Reprinted with permission from BankingInfo (A Consumer Education Programme by Bank Negara Malaysia)

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Knowledge Base ID :   1304
Last Reviewed :   May 22, 2014
Source :   BankingInfo
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