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BUSINESS • 21/12/2024 06:10 PM

FPAM Welcomes BNM Premium Cap - Urges Long-term Healthcare Solution

By Zufazlin Baharuddin

KUALA LUMPUR, Dec 21 (Bernama) -- The Financial Planning Association of Malaysia (FPAM) has welcomed Bank Negara Malaysia’s (BNM) move to cap annual premium increases for medical insurance and takaful at 10 per cent. 

However, it emphasised that rising medical costs and healthcare utilisation must be addressed to prevent significant premium hikes after 2026.  

“A sustainable, long-term solution is urgently needed to ensure that MHIT products remain affordable for all,” said FPAM president Alvin Tan in a statement today.  

Tan also urged Malaysians who have recently surrendered their policies due to premium adjustments to contact their insurance agents or takaful operators (ITOs) about reinstating their policies under BNM’s directive, which could lead to lower premiums.  

Meanwhile, National Association of Malaysian Life Insurance and Financial Advisors (NAMLIFA) president Krishnan Appanu called for greater transparency from ITOs to spread premium changes over a minimum of three years for all affected policyholders.  

“BNM must ensure ITOs issue detailed and transparent notices on the quantum of increases and provide fair options for policyholders,” he told Bernama.  

Krishnan said ageing policyholders face difficulties with annual premium hikes, potentially rendering medical insurance unaffordable when it is most needed.  

BNM announced yesterday that interim measures include requiring ITOs to offer alternative MHIT products at the same or lower premiums for policyholders unwilling to continue with repriced plans.  

Krishnan said switching plans could provide practical options for many policyholders, but warned against reducing coverage, particularly for those with pre-existing health conditions.  

Separately, the Ministry of Health (MOH) recently announced plans to review the Private Health Care Facilities and Services Act 1998 [Act 586] to strengthen the regulatory framework of the private health sector.  

“These measures could help curb high medical inflation, which drives the repricing of medical insurance premiums,” Krishnan said.  

He added that the MOH should ensure transparent, reasonable and cost-effective treatment pricing for various ailments, while pooling ITO resources to share inpatient itemised billing data could help curb insured bill overpricing.

-- BERNAMA

 

 

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