Malaysia orders insurers, takaful firms to review repricing strategies amidst concerns

Firms are asked to offer options to impacted policyholders.

Malaysia’s central bank said that it has acknowledged concerns regarding the repricing of medical and health insurance and takaful products in the market.

Bank Negara Malaysia (BNM) said that it has required insurers and takaful operators (ITOs) to review their current repricing strategies for more reasonable implementation of such repricing.

In a statement posted on its website, BNM recognized that the repricing has “impacted policy owners [and] takaful participants.”

The review reportedly includes tasking the firms to manage increases in the premiums/contributions over time, taking into account the impact on policy owners/takaful participants.

In addition, ITOs are required to offer viable options for policy owners/takaful participants who are significantly impacted by the higher premiums/contributions to continue having insurance/takaful coverage.

ITOs are also tasked with ensuring that the options provided are meaningful and provide additional measures to support affected policy owners/takaful participants, the BNM said.

Further details on the available options will be announced by the insurance/takaful industry soon.

“Over the years, the cost of healthcare has risen significantly due to medical cost inflation and increased utilisation of medical services and procedures. Therefore, comprehensive and coordinated reforms to contain medical cost inflation will be critical to preserve continued access to appropriate [medical and health insurance and takaful] protection,” the BNM said.