by Parliamentary Opposition Leader, DAP Secretary-General and MP for Tanjung, Lim Kit Siang, in Penang on Friday, 20th May 1994:
Mercantile Insurance motor policy holders who cannot get cover from other insurers should report to DAP elected representatives
Mercantile Insurance motor policy holders who cannot get cover from other insurers should report to DAP elected representatives to take up their cases with Bank Negara.
Although Bank Negara has assured all Mercantile Insurance Sdn. Bhd. motor policy holders that they will have no difficulty in seeking cover from other insurers, the practical problem of getting such cover from other insurance companies would be immense and will cause great inconvenience and hardships to the policy holders concerned.
The question is why Bank Negara could not have devised a scheme whereby such inconvenience and hardships could have been avoided altogether.
It was not too long ago that motorists were forced to buy additional insurance policies before they could purchase motor insurance policies. This was because Bank Negara had directed insurance companies to balance the high volume of motor insurance in their business with non-motor insurance portfolios.
Bank Negara, however, owes to the 263,000 Mercantile policy holders – 140,000 of whom are motor policy holders – full responsibility for any losses which they might incur because Bank Negara had taken over Mercantile in March 1991, and since then, policy holders were given assurance that their policies are safe and secure.
Otherwise, the overwhelming majority of the present 263,000 Mercantile policy holders who are now trapped in the present dilemma would not have bought or renewed their policies with Mercantile in the last three years.
When Bank Negara took over Mercantile Insurance in March 1991, the Chairman of the Board of Management was Datuk Lew Sip Hon, former MCA strongman and Deputy Minister.
Bank Negara should issue a full statement to explain to the public and in particular to the 263,000 Mercantile policy holders its stewardship of Mercantile Insurance since its take-over in March 1991 and why it had failed to protect the interests of the 263,000 policy holders.