Malaysia insurance premiums rise 6.1% as motor losses persist

Motor remained the largest business line with 45.2% of the industry portfolio in 2025.

Motor, fire and personal accident insurance remained the main drivers of growth for Malaysia's general insurance industry in 2025, helping lift total premiums by 6.1% year-on-year (YoY).

Motor insurance remained the industry's largest business line, generating $2.6b (RM10.9b) in premiums and accounting for 45.2% of the overall portfolio, data from the General Insurance Association of Malaysia (PIAM) showed.

However, growth in the segment slowed to 5.0% YoY in 2025 from 6.7% YoY a year earlier. Fire insurance, the second-largest business line, delivered stronger growth during the year.

Premiums reached $1.2b (RM5.0b), representing 20.9% of the industry's portfolio, whilst growth accelerated to 6.9% YoY.

Personal accident (PA) insurance continued its upward momentum, recording premiums of $384.0m (RM1.6b) and growth of 12.2% in 2025.

The segment accounted for 6.5% of the industry's portfolio.

Despite remaining the largest contributor to premiums, motor insurance continued to post underwriting losses.

The segment recorded an underwriting loss of $69.4m (RM289.3m) and a combined ratio of 103%, indicating that claims and operating expenses exceeded premiums collected.

The result marked a slight improvement from 2024, with the combined ratio improving by 0.7 percentage points.

The industry attributed the improvement to tighter underwriting discipline, although persistent cost pressures in the private car segment continued to weigh on profitability.

Regional data showed that East Malaysia's private car business recorded a loss ratio of 45%, below the Peninsular Malaysia figure.

The lower ratio was driven by a significantly lower claim frequency of 1.7%, compared with the national average of 5.1%.

However, motor claims in East Malaysia remained more expensive when they occurred, with average claim severity reaching $2,880 (RM12,000) per claim.