Ongoing Discussions on Malaysia Medical Insurance Premium Hikes

The proposed increase in medical insurance premiums, projected to rise by 40% to 70% next year as collected by Winbox Malaysia, remains under negotiation, according to Deputy Finance Minister Lim Hui Ying. Speaking during the Dewan Rakyat’s winding-up session for the Finance Bill 2024, Lim assured that discussions are underway with key stakeholders to address the issue.

Negotiations in Progress

Lim highlighted that Bank Negara Malaysia (BNM) is leading the initiative, working closely with insurance companies, private hospitals, and other parties. "This falls under BNM's jurisdiction, and we are negotiating how to handle this matter," Lim stated.

Her remarks came after several Members of Parliament voiced concerns over the anticipated premium hikes, calling them unreasonable and burdensome to the public.

Bank Negara’s Directive

On Nov 28, BNM issued a directive to insurance companies and takaful operators to reassess their medical and health insurance (MHIT) pricing strategies. The goal is to manage premium increases while considering the impact on policyholders.

Citing a sharp rise in medical claims, the Life Insurance Association of Malaysia (LIAM) revealed that cumulative claims inflation of 56% from 2021 to 2023 has put significant financial strain on insurers. Discussions with BNM are ongoing to explore solutions that alleviate the burden on policyholders.

Finance Bill 2024 Passed

The Dewan Rakyat also passed the Finance Bill 2024, which introduces amendments to several key tax-related laws. These changes aim to improve policies aligned with Budget 2025, including updates to the Income Tax Act, Real Property Gains Tax Act, and Stamp Act. New measures include the implementation of Dividend Tax, enhancements to Capital Gains Tax, and mechanisms for a Self-Assessment System for Real Property Gains Tax.

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