Malaysia: Unclaimed benefits worth over $72.6m
Source: Middle East Insurance Review | May 2019
The insurance and takaful industry has more than MYR300m ($72.6m) worth of unclaimed benefits due to outdated records of policy and certificate holders, according to Bank Negara Malaysia (BNM) as reported by Bernama.
BNM said it is working with the National Registration Department (JPN) to improve the efficiency in the claiming process and reduce the incidence of unclaimed death benefits among Malaysians.
The arrangements with the JPN would facilitate period checks by insurers and takaful operators against the death registry.
BNM said in its Financial Stability and Payment Systems Report 2018 that this would enable insurers and takaful operators to proactively contact and pay the benefits to the rightful beneficiaries. The arrangement is expected to be operational this year.
According to the report, total premiums and contributions from Malaysia’s insurance and takaful sector rose 4.9% to MYR66.6bn in 2018, an increase from MYR63.5bn in 2017. The penetration rate of life insurance and family takaful stood at 41% in 2018.
Meanwhile, over 29,500 policies and certificates have been sold under the Perlindungan Tenang initiative, said BNM. Out of this, 28,900 were life policies and family takaful certificates, while over 600 were fire or flood policies and certificates. BNM also said a study on the key drivers of medical claims inflation and potential cost containment measures would be published by the third quarter of 2019 to provide a better analysis to inform future initiatives.
When it comes to direct distribution channels of life and takaful products introduced in June 2017, BNM said products offered online would be expanded to include pure protection critical illnesses and medical and health insurance/takaful products, effective March 2019.
Meanwhile, it also said the limits on commissions and agency-related expenses for investment-linked products would be liberalised. This is in tandem with the implementation of the Minimum Allocation Rate (MAR) for investment-linked insurance and family takaful products starting in July 2019 and July 2020, respectively. M
MYR1 = $0.24