Medical insurance premiums in Malaysia could rise by up to 30%, with insurers citing a spike in healthcare costs as behind the impending increase.
According to a report by Free Malaysia Today, both insurers and agents have said that rapid inflation in medical and hospitalisation costs in recent years made the increase “inevitable”.
“With the number expecting to rise further and outpace the general inflation rate, we have to make the necessary adjustments to your medical plan’s premiums so that they can keep up with healthcare inflation,” said a notice sent by AIA Malaysia to its clients.
A 2019 survey on medical trends by Willis Towers Watson found that Malaysia had among the highest expected increases in medical costs in Southeast Asia, the report said.
Data from the General Insurance Association of Malaysia (PIAM) showed that total health expenditures in 2018 were at MYR60.15 billion (US$14.77 billion). Of this amount, 52% was funded by the government, while the rest was paid out-of-pocket (35%), through private insurance (7%), and by corporations (4%) and other agencies (2%).
“If healthcare costs are not contained, the increase in premiums for medical and health insurance will be inevitable,” PIAM said, adding that if medical insurance becomes unaffordable, it will drive more patients to seek treatment at government hospitals and further worsen the already-burdened health system.