Premium rates to stay

GREAT Eastern Life (M) Bhd does not expect any increase in its premium rates over the next 1 to 2 years, said chief executive officer Alex Foong. 

“We have already responded to the low returns in the equity market and adjusted our premiums last year,” he said at the launch of the company’s new bereavement care insurance plan in collaboration with NV Multi Corp Bhd in Kuala Lumpur last Tuesday. 

He added, however, that premium hikes would also depend on the situation and that this was hard to predict in such a volatile investment environment. 

Foong said the income of insurance industry players had been affected due to low returns in the equity market as well as not-so-good investment climate in the last few years and Great Eastern Life was no exception. If the situation persisted, adjustments in premium rates or bonus rates for participating products might have to be implemented, he added. 

Foong said every insurance company would have different ways in overcoming such a situation. “As an example, for new products, the premium charged could be increased while maintaining the bonus rate, or the premium rate could be maintained but the bonus rate is reduced,” he said. 

He added that for existing policies, the bonus declared might be adjusted according to the surplus position of the companies involved. 

Foong said Great Eastern remained conservatively positive about the Malaysian economy. “We expect a positive growth in the country’s gross domestic product,” he said, adding that 4% growth should be an achievable rate for this year. 

Great Eastern Life is the oldest and largest life insurance company in Malaysia with assets in excess of RM18bil as at Dec 31, 2002. The company has 15,000 agents and a service network of 24 branches nationwide. 

In another development, Bernama reports that Great Eastern Life is offering a new insurance coverage for Severe Acute Respiratory Syndrome (SARS), details of which are expected to be announced today.  

An official said the SARS insurance was a life insurance policy and not solely for health coverage. 

Those who are categorised as probable SARS cases, quarantined and diagnosed with the disease could apply for the insurance, the official said. 

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