Malaysia PM: Insurance Premium Hikes Must Be Data-Driven and Gradual

Prime Minister Datuk Seri Anwar Ibrahim has emphasized that any adjustments to insurance and takaful premiums must be supported by actual claims data and implemented gradually and prudently. He stated that Bank Negara Malaysia (BNM) will monitor pricing practices to ensure consumer interests are protected and that price hikes are not excessive.

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Any adjustment of premiums by insurance companies and takaful operators must be supported by actual claims data and implemented in stages with care and prudence.

Anwar, who is also the Finance Minister, was responding to a question about the rising premiums for e-hailing vehicles. He explained that these vehicles face risks closer to commercial use than private use due to longer driving hours, higher mileage, and more frequent exposure to traffic. This contributes to a higher rate of accidents and claims costs, further exacerbated by increasing repair and labor expenses.

He noted that in some cases, claims exceed collected premiums, necessitating adjustments to cover the rising costs. BNM, along with the Ministry of Transport, the Land Public Transport Agency (APAD), insurance and takaful companies, and the e-hailing industry, are collaborating to improve the scope and structure of protection. This includes exploring cost-sharing mechanisms with platform operators and utilizing technology like telematics to encourage safer driving and enable risk-based premium setting.

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Insurance companies and takaful operators are also required to provide clear disclosure regarding the scope of coverage, exclusions, and benefit structures received by drivers.

BNM is also actively engaging with driver associations to enhance understanding and improve protection practices within the e-hailing ecosystem. The Prime Minister assured that if any unclear issues or unfair practices arise, complaint channels are available, and each complaint will be assessed objectively under the financial consumer protection framework.

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If there are any unclear issues or unfair practices, complaint channels are available, and each complaint will be assessed objectively under the financial consumer protection framework.