Life insurance industry registers 12.6% drop in total premiums

KUALA LUMPUR, Aug 18 (Bernama) — For the first half of 2020 (1H2020), the life insurance industry recorded an overall dip of 12.6% in total premiums.

During the Movement Control Order (MCO) and Recovery Movement Control Order (RMCO) which started on 18 March 2020, activities of life insurance selling came to a halt as face-to-face selling was restricted for more than three months.

The decline is attributed mainly to the drop in Investment-linked policies which contracted by 24.5% in terms of total premiums.

Investment-linked insurance is an insurance plan which has more unique features and requires face-to-face interaction by agents to explain these features and ascertain its suitability before an investment-linked plan is recommended.

Loh Guat Lan, President of LIAM, said “The COVID-19 pandemic has increased in the awareness among Malaysians on the importance of life insurance protection.

The recent pandemic has been the unexpected catalyst for the adoption of technology than ever before.

The role of life insurance has become even more important as an essential financial tool to reduce uncertainties in life.

Therefore, I would urge all industry players to come together and offer our best service in protecting more people out there with adequate insurance protection to create a better future for themselves and their families.”

Mark O’Dell, CEO of LIAM said, “When the COVID-19 outbreak started in Malaysia, the life insurance industry had been proactive in supporting the Government with various relief measures to assist Malaysians to cope with the impact of the COVID-19 pandemic.

“This facility to defer premium payments is open to affected policyholders until 31 December 2020. As of to date, 1,028,811 policyholders have been granted the premium deferment relief, involving a total of RM1 billion premium payment” added O’Dell.

“Insurance companies have continued to provide other forms of support to help policyholders to keep their policies in-force.

Mark O’Dell, CEO of LIAM

Some of these may include a restructuring of policy features, such as lowering the sum assured or temporarily shortening the policy duration, so that policyholders can keep their insurance protection.

The insurance and takaful industry has also set up a RM8 million COVID-19 Test Fund to support the Ministry of Health’s efforts to conduct more COVID-19 tests for Malaysians.

The Fund is also extended for COVID-19 tests required for hospital admission for emergency and semi-emergency surgeries which is available until 31 August 2020.

This will address the needs of the policyholders and to protect the healthcare front liners from the risk of COVID-19 infection.