The increase in medical insurance premiums this year is a direct result of higher healthcare costs, according to agents who have to bear the bad news to their clients. The National Association of Malaysian Life Insurance and Family Takaful Advisers (Namlifa) said they did not agree with the increase of an estimated 10% to 30% since early this year.
Calling for insurance companies to justify the increase with facts and figures, Namlifa president James Bong, said the pricier coverage would also hinder Bank Negara’s goal to achieve a 75% insurance penetration rate by 2020 and burden the public healthcare system.
Several agents the daily spoke to said the increases, which were “now a norm”, had started early this year, and it was not limited to new products. The agents added their clients were also upset that existing policies had gone up by as much as RM300 per year.
Bong told The Star that Putrajaya should also allow higher tax relief claims for life, medical and education insurance. Life insurance is exempted from the GST, but all traditional and investment-linked policies with medical, critical illness or personal accident benefits are taxed.
The Federation of Malaysian Consumers Association (Fomca) also weighed in on the issue, with its secretary-general Paul Selvaraj saying that insurance premiums would continue to increase if the government does not do anything to control escalating medical costs at private healthcare facilities.
Meanwhile, Life Insurance Association of Malaysia (LIAM) said the need to increase medical insurance premiums was due to healthcare costs increasing by around 15% every year.
LIAM suggested all stakeholders, including the government, insurance companies, private hospitals and doctors, as well as consumers work together to address the higher costs.
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