Bank Negara Malaysia instructed policyholders that from the 15th of this month, they can call insurance companies to request premium sharing, but this move has been criticized by the public as unnecessary. In response, Deputy Finance Minister Lin Huiying said she will further discuss the matter with insurance companies in the coming days, and believes that Bank Negara will issue another statement to clarify the matter.
Following the four interim measures announced by Bank Negara last month to address the surge in premiums for medical and health insurance and Takaful (MHIT), Lin Huiying recently announced that all insurance companies must, from the 15th of this month, provide policyholders with premium sharing measures lasting at least three years, with annual premium increases not exceeding 10%.
In other words, starting from the 15th of this month, insurance companies need to adjust according to the coverage amount of the policyholder's policy. For example, if the policyholder's original monthly premium payment is 200 ringgit, then a 10% adjustment would be equivalent to 20 ringgit.
Additionally, Lin Huiying also clarified that the premium sharing measure will last for three years and will not end in 2026.
She explained that if the insurance company delays adjusting the policyholder's premium, the sharing period will count from the year of adjustment. For example, if the adjustment starts in 2025, the sharing period would be 2025, 2026, and 2027.
"This is a temporary measure, but it does not mean it will stop in 2026, because some insurance companies may not have adjusted the premiums yet. If adjustments are made this year, three years would be 2025, 2026, and 2027."
Lin Huiying stated that this three-year measure is just a temporary measure, and more comprehensive measures will be introduced in the future.
Lin Huiying stated this during an interview with reporters after officiating the opening ceremony of the TLM Food Expo on Friday afternoon.
Moreover, Lin Huiying said that even if the premium increases by 100%, starting from the 15th of this month, the increase must be adjusted to 30%, i.e., 10% or no more than 10% annually.
"This means insurance companies must readjust the premiums."
She also mentioned that under the premise that premiums can only increase by up to 30% in three years, insurance companies cannot change the policy or narrow the coverage scope of the policyholder without permission.
Last December 20, Bank Negara announced a few interim measures, including requiring insurance companies to gradually increase premiums over three years, allowing policyholders to be reinsured without going through underwriting procedures, and for policyholders aged 60 and above who are on minimum premium or contribution plans enjoying medical insurance product protection, insurance companies will suspend premium adjustments for one year starting from the policy anniversary.
The Food & Beverage Industry Accounts for Nearly Half of GDP
Earlier, during her speech at the opening ceremony, Lin Huiying stated that the services industry, including the food and beverage industry, is the cornerstone of our country's economy, accounting for nearly half of Malaysia's Gross Domestic Product. In 2023, the country's food and beverage industry achieved remarkable revenue of 228.66 billion ringgit, with a projected compound annual growth rate of 7.95% from 2023 to 2027.
"By 2029, the revenue of Malaysia's food market is expected to reach an astonishing 80.57 billion US dollars (approximately 362.5 billion ringgit), reflecting a 39% increase from 2024. This continuous growth demonstrates the industry's resilience and its indispensable role in driving national economic progress."
She said that the food and beverage industry also attracts food enthusiasts and tourists, creates job opportunities, and stimulates the local economy.
"Especially Penang, which is the jewel of Malaysia's culinary world. Rated by Lonely Planet as one of Southeast Asia's top travel destinations, Penang's rich culinary tradition, coupled with world-class MICE facilities such as SPICE, SQCC, and the forthcoming PWCC, make it a hub for the food and tourism industries."
She announced that as part of the Prosperous Budget 2025, the government has launched a 50 million ringgit digital package grant through the National Savings Bank (BSN). This initiative aims to assist micro, small, and medium enterprises (MSMEs), including local entrepreneurs, in embracing digital transformation. This aligns with the goals of Malaysia's Digital Economy Blueprint (MyDIGITAL).