Industry commits to partnership to manage pandemic

The insurance and takaful industry in Malaysia has decided to provide supplementary benefits to affected policy holders in a move to support the government’s call on private and public partnership in managing the increasing cases of COVID-19 patients.

“Generally, pandemic-related risks are not covered under any insurance and takaful plans worldwide. The exclusion stems from the difficulty in pricing for coverage relating to an event like a pandemic that may occur once in a lifetime, having an incalculable impact and cost. COVID-19 is a pandemic hence it is not insured/covered under Medical and Health insurance/takaful benefits,” stated a press release on the website of the General Insurance Association of Malaysia (PIAM).

In response to the nation’s immediate need in the early stage of the pandemic in 2020, majority of life insurers and takaful operators have provided supplementary benefits such as daily hospital income to be paid to the affected policyholders/certificate holders.

“Efforts were also swiftly galvanised by the industry to put in place various relief measures to help policyholders/certificate holders cope with the financial impact of the pandemic. Among others, this included the deferment of policy premiums/takaful contributions that have benefitted over 1 million policyholders/certificate holders with premium/contributions valued over MYR1.6 billion. A MYR8 million COVID-19 Testing Fund (CTF) was set up in March 2020 to enable MHI policyholders to undergo testing for COVID-19. In addition to industry-wide efforts, individual ITOs have also rolled out various schemes to aid policyholders/certificate holders,” stated the release.

The industry is currently working with the Ministry of Health and Bank Negara Malaysia to explore avenues where insurers/takaful operators can ease some of the expenses of patients whose conditions are required to be treated in private hospitals under the present circumstances.