KUALA LUMPUR (April 16): Malaysia’s takaful industry is projected to incur an up to RM800 million loss in business opportunity, following the temporary 10% cap on medical insurance premium hikes, according to Malaysian Takaful Association (MTA) chief executive officer Mohd Radzuan Mohamed.
Mohd Radzuan said the significant figure represents a projected loss arising from the inability to collect higher contributions, due to the interim medical insurance premium hikes, rather than an actual profit loss.
“Those companies with large medical portfolios will be more impacted, because their pricing depends on utilisation rates and medical inflation, limiting their ability to collect more,” Mohd Radzuan told reporters on the sidelines at the MTA's 2024 performance briefing on Wednesday.
He noted that the loss projections may vary between RM200 million and RM800 million, depending on the portfolio size and exposure of individual companies, particularly those with a strong medical insurance base.
Bank Negara Malaysia has implemented an interim 10% cap on medical insurance premium hikes until end-2026, to curb the country's escalating medical cost inflation, which reached 15% in 2024, higher than the global average of 10%.