PERSONAL CLAUSE
Cash Before Cover (CBC) Regulation
A Bank Negara Malaysia statutory requirement stipulating that retail Motor, Personal Accident, and Travel insurance policies do not attach risk until the full premium is paid.
Enforced by Bank Negara Malaysia (BNM) and PIAM to eliminate premium credit defaults on retail classes, Cash Before Cover requires individual policyholders to remit the full gross premium prior to policy inception or renewal. Unlike commercial property policies governed by the 60-Day Premium Warranty Clause, a CBC class policy carries zero grace period: if premium is unpaid at the time of an accident, no insurance contract is in force.
BOTH CLAUSE
Condition of Average (Underinsurance Clause)
A mandatory Malaysian property and engineering policy clause that reduces claim payouts proportionally when the declared Sum Insured at the time of loss is lower than the actual full replacement or market value at risk.
Under PIAM Revised Fire Tariff and Malaysian engineering policies, the insured must maintain a Sum Insured equal to the full value of the insured property at the time of destruction or damage. If the Sum Insured is less than the true value at risk (for example, insured for RM3,000,000 when true replacement cost is RM5,000,000), the insured is considered their own insurer for the 40% difference and bears a 40% proportional reduction on every partial or total claim prior to deductible application.
BOTH CLAUSE
Continental Scale (Permanent Disablement Table)
An expanded Personal Accident benefit schedule that grades permanent partial anatomical or functional loss (such as phalanges, joints, vision, and hearing) into granular compensation percentages.
While a basic Personal Accident Scale 2 covers only total loss of limbs, sight, or paralysis at 50% to 100% of the Principal Sum Insured, the Continental Scale breaks down partial permanent disabilities—including loss of individual finger phalanges, metacarpals, toes, partial loss of hearing in one ear, or shortening of a lower limb—into specific indemnity percentages ranging from 1% to 100% of the Principal Sum Insured.
CORPORATE CLAUSE
Discretionary Credit Limit (DCL)
A pre-agreed credit threshold in a Trade Credit Insurance policy allowing the insured company to self-approve buyer credit limits internally using documented vetting criteria without prior insurer underwriting.
To prevent operational bottlenecks on smaller B2B accounts, Trade Credit insurers grant the policyholder a Discretionary Credit Limit (for example, up to RM50,000 or RM100,000 per debtor). As long as the insured verifies the buyer through stipulated procedures—such as clean CTOS/SSM credit agency reports or at least 12 months of prompt payment history with zero dishonored checks—credit sales within the DCL qualify for policy indemnity without individual underwriter sign-off.
BOTH CLAUSE
Forcible and Violent Entry or Exit Clause
A mandatory theft condition in Malaysian Houseowner, Householder, and commercial Burglary policies requiring physical signs of break-in or break-out before theft losses are payable.
Standard PIAM Revised Fire Tariff Householder and commercial Burglary wordings exclude simple larceny, mysterious disappearance, or walk-in theft through unlocked doors or windows. To trigger policy indemnity, the loss adjuster and Royal Malaysia Police (PDRM) investigation report must confirm visible physical damage at the point of entry or exit—such as sheared padlocks, pried window grilles, or broken roof tiles—or violent assault/threat of violence against the occupants (armed robbery / hold-up).
CORPORATE CLAUSE
General Average (Maritime Law)
A maritime legal principle where all parties in a sea venture proportionally share any losses resulting from a voluntary sacrifice of cargo or vessel equipment to save the whole ship in an emergency.
When a container ship suffers a fire, grounding, or engine failure, the shipowner declares General Average. Even if your specific container is untouched, customs and the salvage master will hold a lien over your cargo until a General Average Bond and Marine Cargo Insurer Guarantee are lodged.
BOTH CLAUSE
Indemnity Period (Consequential Loss / Business Interruption)
The contractual duration starting on the date of physical damage and ending when the business's financial results cease to be affected by the disruption, capped at the Maximum Indemnity Period (12, 18, 24, or 36 months).
In Malaysian Consequential Loss underwriting, the Indemnity Period is distinct from the annual policy period. Even if a fire occurs on the last day of the 12-month policy period, the Consequential Loss Indemnity Period runs forward from the date of the fire for the full duration (for example, 12 or 24 months) needed to clear debris, import replacement machinery, obtain Bomba/DOSH clearances, and restore customer turnover to pre-loss trends.
CORPORATE CLAUSE
Medical History Disregarded (MHD)
A corporate group medical underwriting concession that waives pre-existing condition exclusions and waiting periods for eligible employees in compulsory company schemes.
Available for larger non-contributory corporate groups under Group Hospitalisation & Surgical (GHS) policies, MHD allows employees with existing chronic conditions to receive inpatient treatment immediately upon policy inception.