THE issue with congenital conditions and insurance exclusions is not just about rejected claims for Daniel (not his real name), but whether policyholders are being fairly protected in the first place.
As he painfully discovered after he suffered from sudden heart problem symptoms, not only does Daniel have a congenital heart disease, but it was also not covered under his health insurance.
“Imagine paying your insurance premiums religiously for years, only to be hit with a medical emergency and a rejected claim over a condition you never even knew you were born with,” he shares.
The policyholder argues that many Malaysians may not even realise congenital conditions can affect their claims, especially if the condition only surfaces later in life.
Many local insurers apply broad exclusions involving congenital, hereditary and pre-existing conditions, which he says often use legalistic policy wording that consumers struggle to fully understand.
A typical clause may exclude “Any claim arising directly or indirectly from pre-existing conditions, congenital abnormalities, or deformities and any complications arising there from”, he says.
Daniel argues that the problem is not necessarily that insurers assess risk but that the exclusions can sometimes be too broad, leaving policyholders unaware of what is or is not covered.
“In contrast, global best practices define congenital conditions more fairly,” he says.
Instead of blanket exclusions, he points to approaches in other countries where coverage may still be provided through waiting periods, partial payouts or condition-specific limitations.
“The industry is moving away from ‘blanket exclusions’ for everything congenital abroad.
“Instead, modern insurers are adopting a more nuanced strategy.”
He cites Singapore and India as examples of countries that have moved towards more flexible approaches to congenital conditions and pre-existing illnesses.
In India, for example, regulators introduced reforms preventing insurers from permanently excluding conditions discovered after a policy was issued, allowing only limited waiting periods instead.
“The solution wasn’t to force insurers to cover everything for free immediately, but to implement waiting periods – balancing the insurer’s risk with the consumer’s right to protection,” he says.
Such an approach ensures that consumers can still claim, at least partially, for certain conditions, a fair practice which is still largely missing in the Malaysian market, he says.
As such, Daniel believes Malaysia should also move towards clearer policy wording and more targeted exclusions instead of broad clauses that consumers may struggle to understand.
The issue ultimately comes down to balancing risk management with fairness and transparency for consumers, he says.
“At the end of the day, insurance is a business.
“But where do we draw the line between ‘risk management’ and basic humanity?” he questions.
