KUALA LUMPUR (Nov 28): Malaysia’s central bank said on Thursday it has asked insurance companies to review their repricing strategies amid public concerns over a spike in premiums of medical and health insurance products.

Insurers and takaful operators are required to be “more reasonable” with their repricing, including stretching the increases of premiums over time as well as offering “viable” and “meaningful” options, Bank Negara Malaysia (BNM) said in a statement.

The available options will be announced by the industry soon, BNM said without providing further details. The insurance industry is regulated by the central bank.

The statement follows news reports of spikes in medical insurance premiums, which have raised alarms among government lawmakers, including Wong Shu Qi (Pakatan Harapan-Kluang) and Sim Tze Tzin (PH-Bayan Baru).

Insurers companies in Malaysia have complained of escalating claims and medical inflation over the years and, in response, are raising their premiums while introducing co-payment options that will result in cost-sharing with policyholders.

Healthcare providers meanwhile blamed rising costs. The Association of Private Hospitals of Malaysia, which represents more than 150 hospitals in the country, said earlier this month that it does not rake in exorbitant profit, as the industry’s profit-after-tax margins of 9%-11% are modest compared to other sectors.

On Thursday, BNM said it “acknowledges concerns about the repricing” of medical and health insurance and takaful products by insurers and takaful operators, which has affected policy owners.

“BNM remains committed to ensuring that the public continue to have access to suitable insurance and takaful products,” the central bank said.

Comprehensive and coordinated reforms to contain medical cost inflation will be critical to preserve continued access to appropriate protection, BNM said, adding that it is imperative that the relevant stakeholders and the central bank continue to cooperate.

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