Friday, April 20, 2018

Malaysia warns insurers against raising motor premiums

Authorities in Malaysia have warned insurers against raising motor insurance premiums despite the further liberalisation of the motor insurance tariff.

According to Second Finance Minister Johari Abdul Ghani, there must be a basis for any increase in premium rates, while any price increase above 10% requires the approval of the Bank of Negara Malaysia (BNM), the country’s central bank.

He said insurance companies cannot simply increase prices, although an increase of less than 10% is allowable.

Starting July 1 this year, BNM further liberalised the motor insurance tariff by introducing flexible pricing for motor comprehensive and motor third-party fire and theft insurance products.

The liberalisation also provides Malaysians with a lot of motor insurance products to choose from.

Johari added that the central bank has taken several measures to ensure that insurance providers do not simply increase motor insurance premiums without a basis for doing so.

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