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  1. Home
  2. How We Protect YOU
  3. Takaful and Insurance Benefits Protection System
  4. Calculation of TIPS

Calculation of TIPS

Calculation of TIPS

The protected benefits under TIPS will be aggregated only if they relate to the same insurer member, same risk event, same life insured or insured property, and same takaful certificate or insurance policy owner. The aggregation rule is further illustrated in the examples below:

Illustration 1: Mr Lim is employed with Troton Bhd and is insured under his employer’s Group Term policy for RM200,000. He also has a Whole Life policy and an Endowment policy for himself (sum insured of RM300,000 under each policy). All the policies were bought from XYZ Insurance Bhd. In January 2021, he died in an accident.

In the event of failure of XYZ Insurance Bhd, the application of the aggregation rule and the payment of protected benefit (i.e. death and related benefits) that will be made to Mr Lim is as follows:

 GROUP TERM POLICYWHOLE LIFE POLICYENDOWMENT POLICY
Policy OwnerTroton BhdMr LimMr Lim
Insurer MemberXYZ InsuranceXYZ InsuranceXYZ Insurance
Risk EventDeathDeathDeath
Life InsuredMr LimMr LimMr Lim
Aggregation Rule Applies?NOWill be aggregated based on “same policy owner, same insurer member, same risk event and same life insured”.
Amount ClaimedRM200,000RM300,000RM300,000
Amount Protected Under TIPSRM200,000Capped at RM500,000

Illustration 2: Ms. Liza owns two cars and bought the motor insurance policy for both her cars (ABC 666 & IJK 888) with XYZ Insurance Bhd and had filed the following claims with the insurance company and both the claims had not been settled yet.

DATEEVENT DESCRIPTIONDETAILS OF CLAIM
2 January 2021Ms. Liza’s car (ABC 666) was damaged in an accidentClaim 1 - Property damage for RM600,000
15 January 2021Ms. Liza’s car (IJK 888) was damaged in an accidentClaim 2 - Property damage for RM350,000

In the event of failure of XYZ Insurance Bhd, the application of the aggregation rule and the payment of protected benefit (i.e. loss of or damage to property) that will be made to Ms. Liza are as follows:

 CLAIM 1CLAIM 2
Policy OwnerMs. LizaMs. Liza
Insurer MemberXYZ Insurance BhdXYZ Insurance Bhd
Risk EventAccident on 2 January 2021Accident on 15 January 2021
Property InsuredCar - ABC 666Car - IJK 888
Aggregation Rule Applies?NO (not aggregated because the risk event & property insured are different)NO (not aggregated because the risk event & property insured are different)
Amount ClaimedRM600,000RM350,000
Amount Protected Under TIPSRM500,000RM350,000
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