PETALING JAYA: Raising the age limit for insurance policies to cater to Malaysia’s ageing population is an ideal move as long as the products are sustainable and priced according to the risk.
General Insurance Association of Malaysia chief executive officer Chua Kim Soon said insurance premiums tend to increase with age as older individuals generally present higher health risks and are more likely to make claims.
“Increasing the age limit is both a social imperative and a market opportunity, provided that the products remain sustainable and priced according to risk,” he said.
Chua said this when asked whether insurance companies should consider increasing the age limit for policies to better support the country’s ageing population.
ALSO READ: Wider safety net for informal workers
While there is no age limit for property and motor insurance, health and travel insurance is a different story, he said.
“There are existing travel policies covering up to age 85. These policies provide peace of mind to senior travellers who remain active and mobile post-retirement,” he said.
For health and personal accident insurance, he said some products offered coverage up to age 100.
“However, age extensions are subject to insurer-specific underwriting criteria based on actuarial data and risk appetite,” Chua added.
ALSO READ: Experts: Improve support systems for an older society
Life Insurance Association of Malaysia chief executive officer Mark O’Dell said most life insurance products in Malaysia already have maximum entry ages of up to 70 and expiry ages typically up to 99.
However, he added that less than 50% of Malaysians are currently insured, leaving many vulnerable to health and financial shocks in old age.
“While the life insurance segment in Malaysia is relatively strong, basic life insurance does not fully address the needs of an ageing population.
“Product offerings such as senior disability coverage, retirement income plans and simplified or guaranteed-issue plans for seniors with pre-existing conditions exist but currently have a small market share,” he said.
O’Dell suggests that insurers improve on the current underwriting process, by leveraging data-driven models to assess risks more accurately for older adults.
To prepare for an ageing population by 2060, Chua said there should be inclusive insurance access.
“The development of affordable, age-appropriate insurance products, including long-term care and health coverage should be encouraged,” he said.
