Malaysian Underinsured

Currently, the combined life insurance penetration rate for Malaysia is 54% including conventional and takaful, which means only half of the population have some form of life insurance. Malaysians are grossly underinsured.

While Malaysia had a gross income per capita of about RM32,000, a report by the Life Insurance Association of Malaysia (Liam) noted that the average sum assured among Malaysians was less than RM50,000.

When you buy a life insurance policy, the general rule of thumb is to insure a sum equivalent to 10 times your annual salary. The current average sum assured of RM50,000 is far below the ideal amount one should be insured for. This means that Malaysians are generally unprepared for rainy days.