Malaysia’s Transport Ministry launched the Cermat Madani programme to reward motorists with good driving records by offering up to 10% additional insurance premium discounts on top of the existing No-Claim Discount (NCD) of 55% [1, 2, 3, 4, 5]. Transport Minister Anthony Loke said, "If a person has a good driving record, they will be given an additional 10 per cent discount. This means they could enjoy a total discount of 65 per cent on the premium they would otherwise have to pay" [2].
The programme is implemented in collaboration with 10 insurance and takaful providers who will evaluate drivers’ risk profiles using an AI-powered risk assessment system. This system uses data from the Road Transport Department and selected police summonses, applied when motorists renew their road tax via the MyJPJ application [2, 3, 4, 5]. Loke noted, "Maybe it's five, eight or 10 per cent. That's up to the insurance company," emphasizing insurers retain full discretion over discount criteria and exact amounts [3].
Private vehicle owners may apply for the discount up to two months before their road tax expires, starting from June 10, 2026. However, the full AI-driven risk assessment scoring system will only be fully implemented in a second phase beginning September 10, 2026 [2, 3, 4].
The programme is positioned not only as an insurance reform but also as a road safety intervention aimed at encouraging safer and more responsible driving through economic incentives. Loke said, "Cermat Madani is not merely a reform of the insurance system. It is a road safety intervention that uses economic incentives to positively influence driving behaviour" and added, "Responsible drivers should not be assessed in the same way as those who frequently commit offences or have a higher-risk profile" [5].
Unlike commercial or promotional offers, the additional rebates under Cermat Madani are allocated based on data assessment rather than marketing incentives [5].
The programme launch was announced on June 9, 2026, by Minister Loke, with motorists able to begin applying for discounts via MyJPJ from June 10, 2026 [2, 3, 4, 5]. The next key step is the September 10, 2026 rollout of the AI-powered risk scoring system that will underpin the full evaluation and discount allocation process [2, 3, 4].
