The total number of cars in Myanmar has reached its all-time high of about 500,000 but only 1.65 percent of these have been insured until now, a source from state-owned Myanma Insurance Enterprise said.
“Most of the cars which take insurance are small cars purchased on bank loan basis. They bought the cars at costs of around K10-15 million, so they can afford the insurance. Domestic cars and saloon cars usually sign up for insurance the most,” he said on condition of anonymity.
“Also, there are not many companies who provide the service. About 70 percent of the insurance takers are buyers who bought the cars on loans,” he said.
Overall car insurance at Myanmar Insurance Enterprise in 2013-14 fiscal year (from April till now) reached only 5,700. At other private insurance companies the numbers are: 1,284 cars at IKBZ Co, 427 cars at Ayeyar Myanmar Insurance Co, 384 cars at FINIP Co, 55 cars at Global World Co, 322 cars at GGIP Co, 81 cars at Augthitsar Insurance Co, bringing the number of insured cars at private companies to only 2,555.
For insuring a car with K10 million, a premium rate 0.8 percent has to be paid; for taxis the rate is 1.4 percent. To include particular safety measures, higher rates have to be paid.
In Myanmar, car insurances covers mishaps such as road accidents, overturns, car getting burnt or being destroyed by others, damages while being transported and being destroyed during riots or unrests (within 72 hours). Other extra insurances can be bought such as for cars being stolen, destruction due to natural disaster and war or war-like situation.
In terms of compensation K50 million is highest mark, while K1 million extra is paid in case of loss of life in a car accident. Usually, car insurance term is for one year at most, however, the premium is reduced by 25 percent during renewal if no compensations were paid in the last term.
Apart from Myanma Insurance Enterprise, there are 12 private insurance companies in Myanmar. Three companies are permitted to provide only life insurance and the rest are allowed to provide both life and other general insurances.