FROM Sunday, motorists must report all accidents - no matter how minor - to their respective insurers within 24hours or part of their no-claims discount (NCD) will be docked.

Worse, their insurers might not cover them if a claim is filed against them.

This tough stance is the latest attempt by the insurance industry to curb runaway claims, which drove motor underwriting losses to a five-year high of $103.2 million last year.

The picture continues to look bleak this year: In the first quarter, motor-underwriting losses hit $35.3 million - nearly treble that for the same period last year.

Insurers reckon inflated claims are a major cause. These claims are often filed well after an accident.

Although it has long been a legal requirement to report all accidents, this is the first time insurers are insisting on a 24-hour timeframe so 'fresh information' is at hand.

Insurers also believe people are less likely to lie or have less chance to collaborate with workshops to submit inflated claims within the first 24hours of an accident.

In announcing the new step, the General Insurance Association (GIA) - which represents about 30 motor insurers here - said on Monday that car owners will lose 10 percentage points of their NCD if they do not comply.

NCDs are given annually to motorists who have not made accident claims, up to a maximum of 50 per cent of their annual premium.

So a motorist who pays a premium of $500 after a 50 per cent NCD and does not report an accident to his insurer within 24hours would have to pay $600 the next time he renews his policy.

Motorists with no NCD will not suffer this penalty, but the GIA warned that those who do not comply with the new rule are in breach of policy terms and an insurer would have the right to refuse their claims.

Read the full report in Tuesday's edition of The Straits Times.