FAQ

Q: Wouldn't my insurance cover the full amount I paid for the car?

No, insurance will only cover you up to the market value of your car. Assuming you bought a new car at $120K and drive into Malaysia immediately. If you car is stolen, you will most likely be reimbursed with about $115K . This will translate to an immediate loss of at least $5K.

For those who have obtained bank loans, here is a good example taken from the Sunday Times: Assuming you bought a car at $80K and took a 95% loan at 2.75% flat annual interest rate. Your car got stolen 2 years later. By then, your car market value would have decreased by 30% making it worth about $56K. This is the amount insurance company will pay you back. In other words, you will still need to top-up around $14K cash to pay back the bank. You will also need to pay extra because of the prepayment penalty under the Rule 78 in the hire-purchase deal.

An easy way to determine how much you need to top up (assuming your car is stolen now) is to call a 2nd hand car dealer, tell him that you want to sell your car and what is its current market value. Call the bank and ask for the amount you need to pay them if you want to settle the car loan immediately. Subtract the two figures and you will get the amount you need to top up if your car is indeed stolen.

Remember, you will also need to fill in a lot of paper work and wait at least 3 to 6 months before insurance companies will compensate you. Your future insurance premium will also increase because of your car theft history.

Q: Can I prevent my car from being stolen? I have an expensive car alarm,
steering wheel lock and immobilizer installed in my car.

No, you can slow down car thieves but you cannot prevent your car from being stolen. All they need is a tow truck to steal your car in minutes. Some will even wait for you to return to your car so that they can car-jack you and steal your car keys by force. They can break your steering wheel lock with a simple device. They can disable your car alarm with the right technique.

Q: Is it safe to park in hotel or shopping centre car parks?

When you read more about car theft in Malaysia, you will realize that no where is safe, even in hotel car parks. In some cases, cars are reported missing even from car parks with car attendants. In other words, no where is safe when it comes to public car parks.