High Healthcare Cost boosting Medical Insurance Sector in Malaysia: Ken Research
Ken research
announced its recent report on, “Personal Accident and Health
Insurance in Malaysia, Key Trends and Opportunities to 2020 “
Report provides a detailed outlook by product category and a comparison of the
Malaysian insurance industry with its regional counterparts. It provides key
performance indicators such as written premium, incurred loss, loss ratio,
commissions and expenses, combined ratio, total assets, total investment income
and retentions during the review period (2011-2015) and forecast period
(2015-2020). The report also analyses distribution channels operating in the
segment, gives a comprehensive overview of the Malaysian economy and
demographics, and provides detailed information on the competitive landscape in
the country. The report brings together research, modelling and analysis
expertise, giving insurers access to information on segment dynamics and competitive
advantages, and profiles of insurers operating in the country. The report also
includes details of insurance regulations, and recent changes in the regulatory
structure.
General
insurance is typically defined as any insurance that is not determined to be life insurance.
General insurance or non-life insurance policies include personal accident and
health insurance. The Malaysian personal accident and health insurance segment
accounted for a 4.2% of the industry's direct
written premium in 2015. The share of the insurance industry’s written
premiums in 2012 was the lowest share of all the segments. Changing lifestyle patterns
and the prevalence of diseases such as diabetes, respiratory disorders and
other critical illnesses led to a rise in healthcare expenditure, which is
generating a demand for health insurance. The threat of cancer, diabetes and
respiratory disorders has encouraged personal accident and health insurers to
expand their product portfolios. Rising levels of healthcare expenditure,
increasing employment rates and industrial growth drove growth in the segment
during the review period.
The Malaysian
healthcare system comprises public and private healthcare services and the aging population is expected to
drive the segment over the forecast period, due to an increase in demand for
cover. The personal accident and health segment is moderately concentrated, with
the 10 leading insurers collectively accounting for more than sixty percent of
premiums in 2016. The costs associated with private healthcare exclude
participation from lower income demographics. However, with industrial growth, positive employment opportunities and
rising GDP, the nation’s middle class population is expected to
increase over the forecast period and drive growth in the personal accident and
health segment.
Rising consumer healthcare expenditure and limitations of public
healthcare system will provide new areas of growth.
Changing lifestyle patterns and an increase
in the prevalence of a number of common diseases led to a rise in
consumer expenditure on private health insurance during the review period, with
an increasing proportion of the country’s population opting for voluntary
medical policies, some of which are provided by employers. The main reason
behind the rise in healthcare expenditure can be attributed to the fact that
consumers are inclined to avail private healthcare in order to receive a better
quality service. Private healthcare is therefore gaining in popularity, despite
the guarantee of care under the government’s public healthcare system. The
government’s healthcare initiatives ensure health insurance for the foreign
working population. However, the insufficient number of public healthcare centres
and technological limitations encourage foreign workers to purchase private
health insurance.
Rising life expectancy and aging population will, drive growth Increasing life expectancy was a key driver of
growth in the personal accident and health segment during the review period. Life
expectancy is used to calculate the premium to be paid by policyholders when
purchasing a life and personal accident and health insurance policy. According
to World Bank data, in 1960, the average life expectancy of a Malaysian male
was 59.4 years, and for females, it was 60.3 years. In 2011, this figure
reached 72.1 years for men and 76.5 years for women. Life expectancy is
expected to increase further by the end of the forecast period. This trend
indicates a need for insurers to provide medical
plans to cover policyholders beyond the current life expectancy, which
will contribute towards the growth of the personal accident and health segment.
The boost in medical insurance premiums this year is a direct
result of higher healthcare costs, according to agents who have to bear the bad
news to their clients. Calling for insurance companies to justify the increase
with facts and figures, Namlifa president James Bong, said the pricier coverage
would also hinder Bank Negara’s goal to achieve a 75% insurance penetration
rate by 2020 and burden the public healthcare system.
The Malaysian personal accident and health insurance segment is highly
competitive, and contains both domestic and foreign insurers. LIAM suggested all stakeholders, including the government,
insurance companies, private hospitals and doctors, as well as consumers work
together to address the higher costs. Leading companies include: Allianz
General, Berjaya Sompo Insurance, Etiqa Insurance, Lonpac Insurance, MAA
Assurance, MSIG Malaysia, Tokio Marine Insurance (Malaysia) and Uni. Asia
General Insurance. Increasingly, we see companies are involving themselves in
the social media space, and undergoing a re-branding to lifestyle and wellness
companies, and not just a company that sells insurance. In addition, the increasing
and unparalleled progress in technology allows insurers the chance to really
reduce and simplify their offerings to the customer, with a handy approach
allowing them the chance to connect and integrate themselves into the lives of
customers instantly from anywhere. 2020 will be the times of change, and both
insurers and operators alike need to be keenly aware of the changes they face
from 2016 and beyond.
Key Topics Covered in the Report:
Non-life insurance industry
Global life insurance
Life insurance businesses
Insurance sector worldwide
Malaysia non- life insurance market research
Non-Life insurance sector trends Malaysia
Malaysia General insurance regulations
Health insurance market research Malaysia
Health insurance demand Malaysia
Personal Accident Insurance Malaysia
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Contact Us:
Ken Research
Ankur Gupta, Head Marketing & Communications
Ankur@kenresearch.com
+91-9015378249
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