Ankara: Malaysia Non-Life Insurance, states that the non-life sector remains well-positioned for continued growth, even as the countrys real gross domestic product (GDP) growth is forecast to moderate in the near term amid global economic headwinds.
According to BERNAMA News Agency, AM Best noted that Bank Negara Malaysia, the countrys central bank and lead regulator, continues to prioritise broader insurance and takaful penetration, which currently stands in the low single digits for non-life. Additional growth drivers for the insurance market include an anticipated rising demand for digital insurance and natural catastrophe coverage, along with premium rate hikes driven by high inflation and increasing claims frequency.
AM Best senior financial analyst, Sin Yee Chuah, highlighted that Bank Negara Malaysia has progressively liberalised motor and fire insurance tariffs, introducing greater pricing flexibility in phases to support the transition to risk-based pricing since July 2016. Ongoing regulatory measures are expected to help mitigate medical inflation and improve underwriting profitability of the health segment, while rising climate risks, particularly from severe flood events, are prompting regulatory actions to strengthen insurer preparedness.
Meanwhile, AM Best director, head of analytics, Victoria Ohorodnyk, stated these initiatives by Malaysias regulator are expected to reinforce the sectors long-term financial resilience and risk management capacity. Headquartered in the United States, AM Best is also a news publisher and data analytics provider specialising in the insurance industry, with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore, and Mexico City.