PETALING JAYA: The life insurance industry reported a 14.9% growth in new business total premiums of RM11.8 billion last year, from RM10.3 billion in 2018, according to figures by the Life Insurance Association of Malaysia (LIAM).
In 2019, it highlighted that traditional business, investment-linked and group business recorded strong growth at 30.12%, 11.05% and 10.79% respectively. However, total premiums for annuity saw a 78.82% year-on-year (yoy) decline.
The association stated the industry’s healthy performance reflects the increase in awareness among consumers on the importance of life insurance protection.
According to its data, new policies issued in 2019 increased by 6.22% to 1.32 million from 1.24 million yoy, as investment-linked policies continued to be a popular product for the period.
Meanwhile, new business sum assured rose by 6.91% to RM483.4 billion compared to RM452.1 billion reported in 2018.
LIAM’s president, Loh Guat Lan pointed out that the average sum assured for the individual policy category (excluding group insurance) reached RM130,000 per policyholder, but said this level of protection is not adequate as there is a wide protection gap in terms of insurance coverage needed.
“Based on a study conducted by Universiti Kebangsaan Malaysia and LIAM in 2013, it is estimated that a family of five would need at least RM550,000 to meet their living expenses over the next 5 years, in the event of a loss of the breadwinner,” he said in a statement.
In 2019, the association stated that the total in force premiums rose to 7.39% to reach RM36.9 billion from RM34.4 billion in 2018, contributed by investment-linked and employee benefit schemes under group business.
LIAM stated that the total sum assured in force increased 7.83% to exceed RM1.63 trillion, as compared to RM1.51 trillion in 2018.
The total number of policies registered for the whole industry rose marginally to 12.74 million policies in 2019, from 12.67 million policies in 2018.
Meanwhile, total claims payout for the year increased by 10.19% to RM11.9 billion as compared with RM10.8 billion in 2018.
LIAM CEO Mark O’Dell said payment for medical and health insurance were the highest claims category at 41% of all claims paid. In 2019, this amounted to a total of RM4.94 billion, a 20.82% increase from RM4.09 billion.
In regard to its outlook for 2020, LIAM expects to achieve a high single digit growth, despite the uncertainties faced by global and local economies from the Covid-19 pandemic, as this is expected to be mitigated by the strong resilience of life insurance industry and the low insurance penetration rate in Malaysia.
source https://www.thesundaily.my/business/liam-life-insurance-records-double-digit-growth-in-2019-JX2132281
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