How to Transfer Car Insurance in Malaysia (2026)
Selling your car or just bought one? Here's exactly what happens to insurance and NCD, and what both buyer and seller need to do.
For the Seller
Option 1: Cancel the policy and get a refund
RecommendedOnce the car is sold and JPJ transfer is done, contact your insurer to cancel the policy. You'll get a pro-rata refund for unused months, minus an admin fee (~RM30–50). Submit the cancellation with the JPJ transfer letter as proof.
Option 2: Let the policy expire naturally
If your policy expires soon (within 1–2 months), it may not be worth cancelling. Just don't renew it after it expires. No refund but also no admin hassle.
Carry your NCD to your next car
Your NCD is yours — not the car's. When you insure your next vehicle, tell the insurer your current NCD percentage. They verify it with ISM (Insured Services Malaysia). Your accumulated NCD applies immediately.
Pro-rata refund calculation example:
Annual premium: RM800. Policy used: 7 months. Unused: 5 months.
Refund ≈ (5/12) × RM800 = RM333, minus admin fee ≈ ~RM283–300 refund.
For the Buyer
Get a new insurance policy in your name
Before the JPJ ownership transfer, buy a new policy. The policy must be in your name as the new owner. Use Bjak to compare 16 insurers — takes 10 minutes.
Check your NCD status
If this is your first car, your NCD starts at 0%. If you previously owned a car, your NCD from that vehicle carries over. Check your NCD at mydata.ism.com.my.
Complete JPJ ownership transfer
With your new insurance ready, proceed to JPJ with the seller to complete the ownership transfer.
Renew road tax
Once the JPJ transfer is done and your insurance is active, renew the road tax on MyEG or Bjak.
Affiliate link.
What Happens to NCD?
| Situation | NCD outcome |
|---|---|
| Seller sells car, buys another car | NCD carries over to new car — no loss |
| Seller sells car, doesn't buy another immediately | NCD is preserved in ISM system for 3 years. Can apply when next car is purchased. |
| Buyer buying their first car ever | Starts at 0% NCD. Builds up over claim-free years. |
| Buyer already has NCD from previous car | Carries over their existing NCD % to the new car's policy |
FAQs
Can I transfer my car insurance to the new owner?
No. Insurance cannot be transferred between people in Malaysia. The seller cancels (or lets expire) the existing policy; the buyer buys a new one in their own name.
What happens to my NCD when I sell my car?
Your NCD stays with you — it's yours, not the car's. Apply it to your next vehicle's insurance. It's recorded in the ISM system and valid for 3 years even if you don't own a car.
Can I get a refund on unused insurance after selling?
Yes. Cancel your policy with your insurer after the JPJ transfer. You'll receive a pro-rata refund for unused months minus an admin fee of ~RM30–50.
How soon does the buyer need insurance after ownership transfer?
The buyer needs insurance before the JPJ ownership transfer. JPJ requires a valid insurance certificate before processing the transfer and before road tax can be renewed.