Your Road Habits Might Soon Determine Your Insurance Costs

By Lara Kramer  •  11 Jun 2026 in News

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Good news for motorists who play by the rules!

Malaysian drivers with strong road safety records may soon pay less for vehicle insurance thanks to a new government-backed initiative.

Transport Minister Anthony Loke recently launched CERMAT MADANI, a programme that rewards responsible driving behaviour with additional savings on motor insurance renewals through the MyJPJ app.

Under the initiative, eligible drivers can receive up to an additional 10% discount on their motor insurance premiums.

This comes on top of the existing No Claim Discount (NCD) system, which already offers savings of up to 55% for drivers with claim-free records.

For motorists who have already reached the maximum NCD rate, CERMAT MADANI allows insurance providers to apply a further discount on the remaining premium amount, potentially reducing overall insurance costs even more.

Introductory promotion until 9 September

For the first three months of the programme, drivers can enjoy the full 10% discount without undergoing any risk assessment.

The promotional period runs from now until 9 September.

Beginning 10 September, however, eligibility for the additional discount will depend on an individual driver’s risk score, meaning those with safer driving histories are more likely to qualify for better rates.

AI-powered risk scoring system

The programme relies on artificial intelligence integrated into MyJPJ’s backend system.

According to Loke, the system analyses a vehicle owner’s traffic offence history using data from the Road Transport Department (JPJ) and police databases before generating a risk score.

Insurance companies will not have direct access to JPJ records. Instead, they will receive only the risk score generated by the system when assessing customers.

Loke likened the model to a credit scoring system, noting that insurers may adopt different assessment methods and offer varying discounts based on the score. While some companies may provide 5% or 8% reductions, the maximum additional discount currently available is capped at 10%.

A push for safer roads

Beyond lowering insurance costs, the government hopes the initiative will encourage motorists to adopt safer driving habits.

By rewarding drivers who obey traffic laws, avoid repeat offences, and practise responsible road behaviour, authorities aim to reduce accidents and improve overall road safety.

“Road safety is not merely about numbers or statistics. It concerns lives, family well-being, and the interests of the community,” Loke said.

MyJPJ expanding beyond transport services

The initiative is also part of a broader effort to turn MyJPJ into a more comprehensive digital platform.

Since 2025, the Transport Ministry and JPJ have been working with strategic partners to integrate vehicle insurance services into the app. The ministry is also open to allowing more qualified third-party service providers to join the platform, provided they meet technical, security, and data governance requirements.

Looks like Malaysian drivers who keep their records clean may soon find that safer driving pays off in more ways than one!

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