Clarification From PIDM | Ramblings of an e-trader

Thursday, 25 September 2008

Clarification From PIDM

I called up Perbadanan Insurans Deposit Malaysia (PIDM) at their toll-free care line at 1-800-88-1266 just this afternoon as I wanted to seek clarifications on some issues. I first heard of PIDM when they launched their PIDM & You contest and I have been curious of their function ever since but did not have the opportunity to call them up until this afternoon.

First of all, I would have to say that the guy who fielded my call was very friendly and courteous and he answered all my questions very well. He identified himself but too bad his name slipped me

I wanted to know if we were required to pay "buy" any insurance for our bank deposits or if there was any premium to pay. Apparently, participating banks, which are almost all the commercial and Islamic banks in Malaysia, have already bought the insurance on our behalf so we do not have to buy anything or pay for anything.

PIDM, as you may already know, only covers our deposits PER individual PER bank to the maximum amount of RM60,000. This means that if I have RM60000 with Maybank in Ipoh and another RM50000 with Maybank in Kuala Lumpur, I will only be covered up to RM60000.

It does not matter what kind of account I hold, whether savings, current, Fixed Deposit or any other investment account, as long as the total is up to RM60,000, should the bank file for bankruptcy, like Lehman Brothers, PIDM will initiate payment to us within three months. Do note that this insurance is only payable to you should the bank that you bank with collapses.

On the other hand, if we hold an individual account with RM60,000 and then another joint account with another person, and yet another account with another person with the same bank, meaning three accounts with one bank, we will be entitled to a coverage of RM60,000 per account because the joint accounts are considered separate accounts.

I also wanted to know what happens if we have more than RM6000 with one bank. Well, if the unfortunate happens and the bank goes bankrupt, PIDM will return RM60,000 to us within three months. As for any amount beyond RM60,000 though, we will have to file a claim and wait for the bank to be liquidated and then the monies will be divided among all creditors and depositors. I think that sometimes, depositors may not be able to receive 100% of their claim.

If you still have any questions, you could call their toll free number listed above.

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