Page 2 - Malaysian Re Foresights issue 2

MALAYSIAN RE FORESIGHTS ISSUE 2| JULY 2020

Market Overview
M Ma ar rk ke et t O Ov ve er rv vi ie ew w

Malaysia – General Insurance and Takaful 2019

Malaysia General Insurance and Takaful industry There is a downward trend in Miscellaneous class,
recorded a stable growth of its GWP / GWC at 1.8% in mainly from Engineering and Workmen Compensation /
2019. Whilst Motor has been showing steady growth Employers’ Liability (WC / EL) segments. For Engineering,
over the years, Fire growth is slowing down, potentially the contraction in Malaysia construction sector has
due to the challenging phased liberalisation contributed to the negative growth. For WC / EL, the
environment.
reduction is mainly due to the transfer of foreign
workers’ coverage from the Foreign Workers
Compensation Scheme under the Department of Labour
to Social Security Organisation (SOCSO) Employment
Injury Scheme with effect from 1 January 2019, to be in
line with the Equality of Treatment (Accident
Compensation) Convention, 1925 (No.19) and
Conference Committee on the Application of Standard
under the International Labour Organization (ILO),
which Malaysia has ratified.
Marine, Aviation and Transit (MAT) class started to
show 4% positive growth in 2019 after 3 years of
downturn. The increase was mainly due to the recovery
Chart 1 Development of Total Gross Written Premium / Contribution from offshore oil-related sector which had been
(GWP/GWC) from Year 2015 to 2019 for General Insurance and
General Takaful declining from -3% down to -28% in the past 3 years.
Malaysian Re is of the view that one of the possible
reasons for the downward growth in the past is due to
the outflow of premium to offshore insurers, whereby
designated insurer, e.g. offshore insurers, Labuan
insurers and brokers are allowed to provide MAT
insurance coverage in Malaysia.

Personal Accident (PA) class has shown a stable growth
of 1%, whereas Medical & Health has shown its first
significant reduction in 2019 after 3 years with positive
growth. Malaysian Re has received feedback from the
market players where some of the general insurance
companies have reviewed and imposed stricter medical
underwriting due to the undesirable past loss
Chart 2 Development of Gross Written Premium / Contribution
(GWP/GWC) by class of business from Year 2015 to 2019 for General experience and compression in underwriting margin
Insurance and General Takaful Combined
and profitability, thus resulting in lower written
premium.

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