Life Insurance Sector Posts Healthy Growth Of 11.6 Pct In New Business Total Premiums In 2023

KUALA LUMPUR, April 18 (Bernama) -- The life insurance industry recorded a double-digit growth of 11.6 per cent in new business total premiums to RM13.4 billion last year compared to RM12 billion in 2022. 

The Life Insurance Association of Malaysia (LIAM) said the growth was driven by the strong performance of group policies and investment-linked policies which grew 14.5 per cent to RM5.1 billion and 13.6 per cent to RM6.2 billion, respectively.

The overall new business sum assured saw a 9.4 per cent growth to RM544.4 billion in 2023 from RM497.7 billion in the previous year, it said in a statement today. 

LIAM said the new business sum assured of investment-linked policies and group policies registered a double-digit growth of 13.4 per cent to RM155.8 billion and 10.3 per cent to RM368.8 billion, respectively, in 2023. 

"Meanwhile, the number of new investment-linked policies rose by 6.8 per cent to 709,378 and new group policies increased by 5.8 per cent to 21,975 last year.

"However, new traditional policies recorded a decline of 56.9 per cent from 1.2 million in 2022 to 496,115 in 2023, resulting in the overall number of policies falling 33.2 per cent to 1.2 million in 2023 compared to 1.8 million in 2022," it added.

LIAM said the total premium in force grew by 5.0 per cent to RM46.3 billion in 2023 compared to RM44.1 billion in 2022.

The association also highlighted that the number of policies in force of group policies and investment-linked policies grew by 4.5 per cent to 28,685 and 4.0 per cent to 6.7 million, respectively, in 2023.

However, traditional policies declined by 9.7 per cent which contributed to the drop in the total number of policies in force to 3.1 per cent in 2023 amounting to 13 million against 13.4 million in 2022, due to the expiration of the policies issued under the Perlindungan Tenang Voucher Scheme in 2022.

On claims, LIAM said the total payout surged by 14.9 per cent to RM15.4 billion last year compared to RM13.4 billion in 2022, primarily driven by a 41.4 per cent hike in disability payment and a 26.2 per cent in medical claims.

The surge in claims payout was also due to the high medical inflation rate in Malaysia and it is expected that the higher medical claims will add pressure on premium increases going forward, it added. 

On prospect, LIAM stressed that the industry is poised to maintain its growth momentum and resilience amidst evolving market dynamics. 

"Various efforts outlined under the Financial Sector Blueprint 2022-2026 are being carried out to strengthen and to push the development to a higher level, to deliver better products and services to the consumers," it said. 

-- BERNAMA