KUALA LUMPUR (Jan 29): Insurers and takaful operators must meet the eligibility criteria to be allowed to sell the base medical and health insurance and takaful plan.
The requirements will ensure only insurers with the financial capacity to underwrite medical insurance are allowed to sell the products under the government-led initiative, Finance Minister II Datuk Seri Amir Hamzah Azizan told the Dewan Rakyat during ministerial question time on Thursday.
All participating insurers will be required to offer the products at the same premium rates, eliminating price-based competition for the base plan, he said.
Malaysia is set to launch a pilot programme for the base plan in the second half of 2026, with the full rollout in early 2027. The initiative is a key component of a strategy led by the Finance Ministry, Health Ministry, and Bank Negara Malaysia to tackle soaring medical inflation and insurance premiums.
The initiative, designed to provide lower-cost coverage for essential medical care, targets middle-income households and policyholders who exited private medical plans following repricing in 2024 and 2025, with participation remaining voluntary.
A standardised premium allows risks to be pooled more broadly across participating insurers and takaful operators, rather than being borne by individual companies or policyholders, Amir Hamzah noted.
Further, expanding participation and increasing the number of policyholders within the same risk pool would help to lower overall premiums over time. Wider participation is also expected to allow insurers to offer better value coverage while keeping costs under control, he said.
Once the programme is fully rolled out, existing policyholders will have the option to switch to the base plan with their current insurer or takaful operator without undergoing re-underwriting or serving new waiting periods, after the interim phase ends.
The government is also in talks with the Employees Provident Fund to determine whether the plan could be accepted as one of the products eligible for withdrawals, Amir Hamzah added.
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