KUALA LUMPUR – The continuous rise in medical inflation has led to an increase in the claims rate for medical and health insurance and takaful (MHIT), Finance Minister II Datuk Seri Amir Hamzah Azizan said.
He said Bank Negara Malaysia (BNM) has taken several interim measures to curb the impact of rising MHIT premiums on policyholders, which took effect on January 15.
The interim measures include the distribution of premium adjustments due to medical claims inflation over a period of at least three years until the end of 2026, and a one-year delay in premium adjustments due to medical claims inflation for policyholders aged 60 and above who are covered under the minimum plan for the MHIT products purchased.
“Additionally, policyholders whose policies have expired in 2024 due to the premium reset can contact their respective life insurers and family takaful operators (ITO) to request their policies be reactivated based on the adjusted premiums,” he said during the question and answer session in the Dewan Rakyat today.
Amir Hamzah was responding to a question from Lim Guan Eng (Bagan-PH) regarding the profits of life insurance companies since 2018 and the resolution of the controversy over premium increases for medical insurance, which have surged by as much as 70%, as well as steps to prevent arbitrary hikes in private healthcare costs.
He said through these interim measures, 80% of policyholders are expected to face annual premium adjustments of less than 10% due to medical claims inflation.
Meanwhile, Amir Hamzah said the average annual profit of the insurance and takaful industry between 2018 and 2023 was RM4.4 billion from life insurers and family takaful operators (ITO).
At the same time, he said the government, through the Health Ministry (MOH), will prioritise comprehensive health reforms to address the issue of medical inflation and charges at private hospitals.
“These efforts include implementing the Diagnostic Related Group (DRG) payment model, enhancing transparency in drug costs, and comparing common medical costs.
“Other measures that can be taken by private hospitals to curb medical inflation are also being discussed as long-term solutions,” he said. – February 6, 2025