PETALING JAYA: There is a good chance that escalating premiums will lead to an increase in lapses in insurance policies as they become unaffordable, says the Federation of Malaysian Consumers Associations (Fomca).
Its chief executive officer Dr Saravanan Thambirajah said this is especially true for members of the middle- and lower-income groups, many of whom may be forced to discontinue their policies, leaving them without essential medical coverage.
“This trend has been observed in past instances of premium hikes.
“As previously stated, Fomca has received numerous complaints from policyholders regarding substantial increases in medical insurance premiums.
“To address this issue, we recommend several measures including regulatory intervention, with Bank Negara Malaysia implementing stricter controls on premium increases and ensuring that any adjustments are justified and transparent,” he said in response to the expected rise in health insurance premiums announced recently.
Saravanan also argued there should be greater competition among insurers so that consumers may benefit from more affordable premiums.
Greater public awareness is another crucial factor in empowering consumers to make informed decisions regarding their medical insurance and the options available to them, he added.
Saravanan also recommended greater transparency by insurers, who often fail to provide clear justifications for premium hikes, leaving consumers in the dark.
He added that implementing such measures could help ensure medical insurance remains accessible and affordable while reducing the strain on public healthcare facilities and ensuring that all Malaysians have access to necessary medical services.
In 2021, Fomca received over 1,500 complaints related to the insurance industry, with a significant number concerning steep hikes in medical insurance premiums.
Consumers’ Association of Penang president Mohideen Abdul Kader said steep premium hikes are disadvantageous to those who have paid their premiums for many years without making any claims.Those in older age brackets will also find it difficult to pay their insurance premiums because their earning capacity has declined or ceased, in addition to having to worry about inflation reducing their monthly budget, he said.
“At this stage, they usually have developed age-related diseases or other common non-communicable diseases and have to consider terminating their health insurance policy at this crucial juncture,” Mohideen said, adding that the problem cannot be solved in isolation.
As such, he said the government will have to bring all stakeholders together to identify possible solutions.
Implementing the Anti-Profiteering Act 2018 is one of the ways to regulate overinflated prices, particularly on consumables and other charges, he added.
“The professional fees of doctors and surgeons are regulated under the Private Healthcare Facilities and Services (Private Hospitals and Other Private Healthcare Facilities) Regulations 2006,” Mohideen said.
