Latest news with #GeneralInsuranceAssociationofMalaysia
The Star
03-06-2025
- Business
- The Star
Millions of M'sian homes uninsured and vulnerable
PETALING JAYA: Day in, day out, stories appear about fires, flash floods or other catastrophes caused by extreme weather. Yet, few Malaysian homeowners seemed inclined to protect their homes against such calamities. 'More than 50% of Malaysian households remain uninsured against structural damage caused by fire, floods or severe weather conditions,' said the General Insurance Association of Malaysia (PIAM). According to its data, the take-up rate for fire and home insurance policies has remained at around 43% for the past two years. In 2023, only 3.89 million homes were insured out of the 8.88 million households. Last year, of the 9.1 million households, only 3.87 million had a fire and home insurance policy. As climate events grow more unpredictable and property values rise, PIAM said homeowners should reassess their protection strategies for their property and contents. Citing a 2024 climate resilience survey by Zurich Malaysia, PIAM said 54% of Malaysians feel unprepared for potential climate risks, with 38% citing financial constraints as a barrier to being adequately protected. 'Floods (75%), heatwaves (74%) and landslides (70%) are the top worries, while urban infrastructure risks, for example fallen trees and sinkholes, are becoming an emerging concern (67%), following recent incidents in Kuala Lumpur,' it said. PIAM, on its part, is raising awareness of the flood coverage options available for homeowners, citing policies that could be just RM14 a month (or 0.086%) of the sum insured for a RM200,000 property. 'The key advice is to contact your insurance provider or agent to learn more about fire and home insurance policies and how to best protect your home and belongings against potential risks,' it said. However, the association acknowledged that there had been a gradual increase in demand among Malaysians for more comprehensive home insurance plans, particularly those covering flood and climate-related risks. 'In the first half of 2023, the take-up rate for fire insurance policies with flood coverage increased to 33%, up from 31% in 2022,' it added. Some of the preferred coverages include the basic fire coverage, which covers damages from direct burning, heat, smoke, and extinguishing water, which can affect nearby properties. Financial institutions often mandate this for homes with mortgages. Aside from that, householder and house owner policies cover damages that are not only confined to the structure but also to contents and personal liability. 'These policies offer broader protection, particularly valuable given Malaysia's vulnerability to floods and fire,' it said.
Malaysian Reserve
07-05-2025
- Automotive
- Malaysian Reserve
Malaysia's general insurance grew 6.9% in 2024
THE nation's general insurance (GI) industry posted a commendable 6.9% year-on-year (YoY) growth in gross written premiums (GWP) in 2024, reaching RM23.1 billion. The growth was primarily driven by a recovery in vehicle sales and sustained activity in infrastructure-related projects. However, rising claims and cost pressures eroded profitability, with underwriting profit declining by 11%. Despite ongoing global economic headwinds — including persistent trade tensions and inflationary pressures — the local insurance sector demonstrated resilience. According to the General Insurance Association of Malaysia (PIAM), growth was particularly strong in the motor, fire, marine, aviation and transit (MAT) segments, supported by renewed domestic demand and industrial expansion aligned with the national economic framework. Motor, Fire Lead, Profitability Under Pressure Motor insurance continued to dominate the GI market, registering a 6.7% increase in premiums, equivalent to RM651.1 million in new business. This was bolstered by a 2.1% rise in new vehicle registrations in 2024, according to the Malaysian Automotive Association (MAA). However, profitability in the segment was squeezed by higher repair costs, increased Sales and Service Tax (SST), and a spike in accident claims. Net claims incurred in the motor segment rose by 18.8% over five years to RM6.5 billion in 2024. Fire insurance, the second-largest premium contributor, expanded by 5.8% or RM258.5 million. The increase was attributed to a 4.9% rise in average premiums, reflecting higher material and reconstruction costs. Despite mounting reinsurance expenses and a rise in weather-related incidents, Fire remained profitable, with a Net Claims Incurred Ratio (NCIR) of 34.1%. Health Insurance Grows Medical and Health Insurance (MHI) saw a 10% jump in premiums last year, even as average premium levels dropped by 12.5%. However, the NCIR in this segment remained elevated at 68.3%, underlining the persistent challenge of medical cost inflation. 'If premium levels are not managed moving forward through industry-wide initiatives, the industry could face future headwinds in sustaining profitability and managing risks within this class,' PIAM said in the statement. Other standout performers included personal accident insurance (+14.8%) and MAT (+14.2%), while the liabilities segment also grew 8.1% due to expanding public and business liability exposures. Notably, the contractor's all-risk and engineering (CARE) segment under the miscellaneous class surged 141.6% over five years, reflecting renewed momentum in infrastructure projects nationwide. Investment Income Cushions Profitability The industry's NCIR rose from 53.7% in 2022 to 57.6% in 2024, largely due to deteriorating motor claims, which made up 60.9% of 2024's net earned premium. Nevertheless, the industry maintained a healthy combined ratio of 93.4%, suggesting continued operational efficiency. Investment income proved crucial, contributing 60% of total operating profits, while net commission ratios stayed stable at 10.4%. Looking ahead, PIAM projects a sustained growth trajectory in 2025, anchored by Malaysia's solid economic fundamentals. 'GI industry remains on a steady growth path,' the statement said, with strategic focus shifting toward sustainable underwriting, electric vehicle (EV) insurance innovation and building resilience against climate-related risks. Bank Negara Malaysia (BNM) has forecast continued GDP growth through 2026, supported by consumer spending, investment and export recovery. However, insurers will need to contend with rising inflation, driven by fuel subsidy reforms and SST expansion, and an expected increase in medical cost inflation from 15% in 2024 to 16.4% in 2025 — significantly above the Asia-Pacific average of 10%. — TMR
Daily Express
02-05-2025
- Business
- Daily Express
Putra Heights incident underscores why home insurance matters
Published on: Friday, May 02, 2025 Published on: Fri, May 02, 2025 By: Bernama Text Size: According to the official tally by authorities, 437 houses were located in the affected area of the Putra Heights gas pipeline explosion. (Bernama pic) Kuala Lumpur: The gas explosion at Putra Heights on April 1, which destroyed scores of homes, serves as a stark reminder for homeowners to insure their houses as well as the contents inside their homes to mitigate losses from such unforeseen calamities. The fire that broke out at 8.10am saw flames soaring over 30m high, with temperatures exceeding 1,000°C, destroying residential properties and vehicles within a 500m radius. It took nearly eight hours for the fire to be fully extinguished. Some 1,254 people from 308 families were affected, with damage to residential properties amounting to some RM65 million. The tragedy serves as a stark reminder that the unexpected can happen at any time, underscoring the importance of comprehensive insurance to provide financial protection against such unfortunate events. Here are three types of insurance coverage available for homeowners. Houseowner policy According to the General Insurance Association of Malaysia, this is a comprehensive policy that covers the physical structure of the home against risks such as fire, lightning, natural disasters, burst pipes and, yes, even explosions. Association CEO Chua Kim Soon said that, in the case of the Putra Heights incident, the houseowner policy would cover damage from the explosion, with compensation based on rebuilding costs. 'For claims purposes, they need to obtain written approval from the insurer before proceeding with any house repairs, including emergency work, as unauthorised work may not be covered by the homeowner policy and certificate,' he told Bernama. Banks typically require homeowners' insurance as part of the loan agreements for mortgages. For condominiums or apartments, it is mandatory for the joint management body to take out a master policy for home insurance coverage. A houseowner policy is priced at an average of RM382 per year for flats and apartments, and RM377 for landed properties. The premium price would depend on the sum insured value of the house. Householder policy This policy involves the safeguarding of household contents, protecting against loss or damage from incidents such as fire, theft, and certain natural disasters. Unlike the houseowner policy, which is mandatory when a home loan is involved, the householder policy is optional and can be purchased separately at an average price of RM142. The premium would depend on the sum insured value. Sadly, householder policies are often overlooked due to a lack of awareness. As a result, many affected homeowners may not be covered in the event of untoward incidents such as the Putra Heights explosion. Fire insurance According to Chua, standard or basic fire insurance covers damages from fire, lightning, or explosions caused by gas used for domestic purposes. 'For damages due to an explosion caused by other than domestic gas, an extension in the form of an optional add-on can be purchased,' he said, noting that compensation is based on the rebuilding costs. Generally, fire insurance is not mandatory for homeowners unless it is required by their banks for housing loans. Insurance take-up rates According to the statistics department, out of 9.1 million households in 2024, only 3.88 million fire and home insurance policies were recorded, reflecting a take-up rate of 42.6%. In comparison, there were 8.88 million households in 2023, with 3.89 million fire and home insurance policies recorded, reflecting a take-up rate of 43.8%. This, Chua stressed, indicates that more than half of Malaysian households remain unprotected against structural damage caused by fire, floods, severe weather events, and other unexpected incidents.
The Sun
30-04-2025
- Automotive
- The Sun
PIAM: General insurance industry remains on a steady growth path
KUALA LUMPUR: Malaysia's general insurance (GI) industry remains on a steady growth path despite external uncertainties and inflationary costs, said the General Insurance Association of Malaysia (PIAM). In a statement today, it said 2025 will see continued emphasis on sustainable underwriting, innovation in electric vehicle insurance, and resilience-building against climate risks, as insurers align their strategies with evolving consumer needs and regulatory expectations. 'Malaysia's GI sector is poised for further growth in 2025, driven by economic recovery and increased demand for digital insurance products. 'There is also growing interest in natural catastrophe insurance. Medical cost inflation remains a concern, with projections rising from 15% in 2024 to 16.4% in 2025, significantly above the Asia-Pacific average of 10%,' it said. According to PIAM, Malaysia's GI industry recorded a resilient performance, with gross written premium growing by 6.9% year-on-year (y-o-y) to RM23.1 billion in 2024, driven primarily by the recovery in vehicle sales and continued momentum in infrastructure and liability-related insurance. 'The GI industry remained robust despite global economic headwinds stemming from escalating trade tensions and inflationary pressures,' it said. PIAM noted that motor, fire, marine aviation and transit segments led the premium growth, supported by strong domestic demand and industrial recovery initiatives under the national economic framework. It said motor insurance contributes the largest share of total gross written premium, rising 6.7% to an additional RM651.1 million in premiums against the previous year, underpinned by a 2.1% y-o-y rise in new vehicle registrations, as reported by the Malaysian Automotive Association. 'Meanwhile, fire insurance premiums grew by 5.8%, amounting to RM258.5 million in additional premiums, driven by a 4.9% rise in average premiums – a reflection of higher material and reconstruction costs. 'Nevertheless, the fire business line remains the second-largest line and profitable with net claims incurred ratio at 34.1%, despite rising reinsurance costs and the frequency of weather-related events,' it added. – Bernama
Free Malaysia Today
29-04-2025
- Automotive
- Free Malaysia Today
General insurance premiums up 6.9% in 2024, but profits down
Motor insurance was the largest contributor to premium growth last year, thanks to a 2.1% increase in new vehicle registrations compared with 2023. (File pic) PETALING JAYA : The general insurance industry recorded RM23.1 billion in gross written premiums in 2024, marking a 6.9% growth compared with the preceding year. The General Insurance Association of Malaysia (PIAM) said this growth in general insurance premiums was mostly thanks to the recovery in vehicle sales and sustained momentum in infrastructure and liability-related insurance. However, PIAM said industry players saw their underwriting profit slashed by 11% last year. PIAM said motor insurance was the largest contributor to premium growth last year, with an additional RM651.1 million yielding a 6.7% rise, thanks to a 2.1% increase in new vehicle registrations compared with 2023. However, it said motor insurance providers saw their profits come 'under pressure' due to inflation in vehicle repair costs, the service tax increase for insurance firms and a rise in road accident claims. The association said fire insurance premiums rose by RM258.5 million, or 5.8%, from 2023, adding that this was a reflection of higher building material and reconstruction costs. PIAM said the medical and health insurance sub-sector also recorded growth with a 10% surge in premiums in 2024, despite a 12.5% decline in average premiums. 'However, this segment's net claims incurred ratio remains elevated at 68.3%, reflecting the ongoing challenges of medical inflation. 'If premium levels are not managed moving forward through industry-wide initiatives, the industry could face future headwinds in sustaining profitability and managing risks within this class of insurance business,' it said in a statement. The group nonetheless expressed confidence that the general insurance industry was on a steady path of growth despite external uncertainties and inflation. Bank Negara Malaysia previously called on insurers and takaful operators to review their repricing strategies for more 'reasonable implementation' after reports of a 40% to 70% hike in medical insurance premiums this year. Insurers and takaful providers said the increased premiums were 'unavoidable' in light of rising claims and medical inflation.
