LIFE INSURANCE SECTOR POSTS HEALTHY GROWTH OF 11.6% IN NEW BUSINESS TOTAL PREMIUMS IN 2023
The life insurance industry recorded a double-digit growth of 11.6% in new business total premiums to RM13.4 billion last year compared to RM12 billion in 2022.
The Life Insurance Association of Malaysia (LIAM) said the growth was driven by the strong performance of group policies and investment-linked policies which grew 14.5% to RM5.1 billion and 13.6% to RM6.2 billion, respectively.
The overall new business sum assured saw a 9.4% growth to RM544.4 billion in 2023 from RM497.7 billion in the previous year, it said in a statement.
LIAM said the new business sum assured of investment-linked policies and group policies registered a double-digit growth of 13.4% to RM155.8 billion and 10.3% to RM368.8 billion, respectively, in 2023.
"Meanwhile, the number of new investment-linked policies rose by 6.8% to 709,378 and new group policies increased by 5.8% to 21,975 last year.
"However, new traditional policies recorded a decline of 56.9% from 1.2 million in 2022 to 496,115 in 2023, resulting in the overall number of policies falling 33.2% to 1.2 million in 2023 compared to 1.8 million in 2022," it added.
LIAM said the total premium in force grew by 5.0% to RM46.3 billion in 2023 compared to RM44.1 billion in 2022.
The association also highlighted that the number of policies in force of group policies and investment-linked policies grew by 4.5% to 28,685 and 4.0% to 6.7 million, respectively, in 2023.
However, traditional policies declined by 9.7% which contributed to the drop in the total number of policies in force to 3.1% in 2023 amounting to 13 million against 13.4 million in 2022, due to the expiration of the policies issued under the Perlindungan Tenang Voucher Scheme in 2022.
On claims, LIAM said the total payout surged by 14.9% to RM15.4 billion last year compared to RM13.4 billion in 2022, primarily driven by a 41.4% hike in disability payment and a 26.2% in medical claims.
The surge in claims payout was also due to the high medical inflation rate in Malaysia and it is expected that the higher medical claims will add pressure on premium increases going forward, it added.
On prospect, LIAM stressed that the industry is poised to maintain its growth momentum and resilience amidst evolving market dynamics.
"Various efforts outlined under the Financial Sector Blueprint 2022-2026 are being carried out to strengthen and to push the development to a higher level, to deliver better products and services to the consumers," it said.