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And the "blood-suckers" want to raise premiums to profiteer!!!
Up to 262% hike in insurance premiums: What’s wrong with the UG?
Update2
Hey! Don't just talk or provide lip service! Action please!
Health insurance companies called to explain premium increment
By JUNAID IBRAHIM, MARTIN CARVALHO and RAHIMY RAHIM
Wednesday, 04 Dec 2024
3:38 PM MYT
KUALA LUMPUR: Each health insurance and takaful operators are urged to explain the premium increment to their policyholders.
Sim Tze Tzin (PH-Bayan Baru) in a press conference said that each operator should be responsible for disclosing any information on the pricing of their products.
“We urge, hope and wait for each operator to issue statements to explain their position in this matter.
“We would also request that Bank Negara Malaysia explain the real situation on the purported increment of health premiums as planned by the operators. Will the central bank instruct the operators to study the price hike?” he told reporters at the parliament building here on Wednesday (Dec 4).
Sim added that the hotline he launched to gather grievances from the public regarding the increased health premium had received over 147 complaints across two weeks.
The complaints were received through email, calls and messages on WhatsApp.
“This proves the anger of the rakyat against the abrupt increase in the pricing of insurance premiums,” he added.
Sim shared a complaint he received from an 85-year-old policyholder which was slapped with a 78% hike within a year.
“Her insurance policy has increased annually since 10 years ago. In 2021, she had to pay RM5,615, RM6,065 (2023) and RM10,815 (2024).
“The price skyrockets within a year, with a 78% hike,” he said.
On Tuesday (Dec 3), it was reported that the Life Insurance Association of Malaysia (LIAM) said that it was still in discussions with Bank Negara Malaysia (BNM) about measures to ease the burden on policyholders resulting from the unprecedented rise in claims over the past several years.
It added that throughout 2021 to 2023, unprecedented cumulative medical claims cost inflation of 56% placed many insurers in a critical position on their medical books of business, having to manage a high ratio of claims over premiums.
“The rising cost of care at private hospitals as well as the sharp increase in the number of policyholders seeking treatment have driven up claims and premiums,” said the association on its official website.
Previously, it was reported that medical insurance premiums are expected to rise by between 40% and 70% next year, following notices sent by insurance providers to policyholders citing the rising cost of medical care in private hospitals as the primary reason.
In a joint statement on Nov 28, LIAM, Malaysian Takaful Association, and General Insurance Association of Malaysia said they understand these adjustments may cause concern but will “remain committed to providing transparency and support during this time”.
Bank Negara said in a statement that it requires insurers and takaful operators to review their current repricing strategies to provide a more reasonable adjustment.
The central bank said this includes managing increases in premiums or contributions over time by taking into account the impact on policy owners or takaful participants.
Update1
Life Insurance Companies Profit From RM3.2 Billion To RM8.4 Billion In 6 Months – Malaysian Salaries Do Not Go Up By 40-70%
4 December, 2024
Life insurance companies in Malaysia risk facing widespread public outrage if they proceed with plans to raise medical insurance premiums by an excessive 40-70 per cent next year, warned DAP chairman Lim Guan Eng today.
In a statement, the Bagan MP said the 16-member Life Insurance Association of Malaysia (LIAM), led by its CEO Mark O’Dell, should reconsider their decision not to alter the proposed premium hikes.
He urged for gradual and sustainable adjustments instead of what he described as a massive and unreasonable increase.
“Any repricing adjustments of medical insurance premiums should be implemented gradually in a sustainable and reasonable quantum, not an excessive and massive 40-70 per cent hike as is proposed for next year,” said Lim.
“There is no evident urgency for life insurance companies to have such a massive and excessive 40-70 per cent hike in medical insurance premiums when they are recording healthy profit growth,” Lim said.
He cited Bank Negara Malaysia’s data showing a rise in profitability for life insurance and family takaful funds, from RM3.2 billion in the second half of 2023 to RM8.4 billion in the first half of 2024.
“Have life insurance companies not earned enough? Why should they earn more profits off the backs of hard-working and hard-pressed Malaysians?” he questioned.
Lim criticised the moral and social implications of the hikes, pointing out the disparity between rising medical premiums and stagnant wages.
“Do our salaries go up by 40-70 per cent?” he asked, highlighting the burden on ordinary Malaysians already grappling with increasing costs of living.
He called on Bank Negara and the Health Ministry to address the root causes of rising medical care costs in private hospitals.
Lim suggested that expensive buyouts of private hospitals by private equity funds might be driving up healthcare charges, as these funds aim to recoup their investments.
“Getting both the insurance companies and private hospitals not to overcharge their customers will ensure a more sustainable private healthcare system for the benefit of all Malaysians,” Lim said.
He warned that unaffordable premium hikes could lead many to cancel their policies, further straining Malaysia’s already overstretched public healthcare system.
“Bank Negara must do their duty and exercise their responsibility on behalf of 31 million Malaysians to prohibit life insurance companies from proceeding with the 40-70 per cent hike in medical insurance premiums next year,” he concluded.
Source : Malay Mail
KUALA LUMPUR, Dec 4, 2024: Is Prime Minister Anwar Ibrahim’s so-called Madani Unity Government (UG) that uncaring as to allow insurance companies and private hospital to engage in profiteering?
As it is, insurance companies and private hospitals are already making billions of Ringgit in profits eevery year.
Why then is the UG and Bank Negara Malaysia (Central Bank), the regulators of the insurance industry, not doing anything to stop the up to 262% hike in health insurance premiums?
It is reported that the hike in medical insurance premiums will make Malaysia like the US where medical and insurance costs are beyond the reach of the rakyat (people).
What's happening or going on with the UG? Why is the UG condoning the actions of the "blood-suckers"?
No News Is Bad News reproduces below a slew of news compiled and reposted by The Coverage:
262% Premium Hike : Malaysia Will Be Like USA Where Medical & Insurance Costs Are Beyond The Reach Of The People
4 December, 2024
Cancer Patient Dropped Medical Insurance After 262% Premium Hike: Bayan Baru MP
A cancer patient decided not to renew his medical insurance policy last August after his premiums surged by 262.5 per cent, said Bayan Baru MP Sim Tze Tzin.
The government backbencher – who is leading a campaign along with a few other Members of Parliament from PKR against the rise in health insurance premiums and private hospital charges – disclosed the complaint by the cancer patient to his team’s email address at aduan.pkr.hospital.insurans@gmail.com.
“Because of a burdensome premium increase of over 262 per cent, he was unable to afford such expensive insurance, leading him to cancel his insurance policy,” Sim told a press conference in Parliament yesterday.
“I pity him – he was loyal to one insurance company for 15 years. In the end, the premium increase caused a cancer patient to drop his insurance, and now he will have to go to a government hospital.”
Sim’s office told CodeBlue that the complainant, who was previously admitted to a private hospital, would now seek treatment at a public hospital if he fell seriously ill again.
At his press conference, Sim cited another complaint of a person’s sibling being charged RM200,000 at a private hospital for treatment after getting into an accident. But because the procedures “didn’t go right”, the patient was sent to Hospital Canselor Tuanku Muhriz UKM, a university hospital, that charged RM60,000.
“I want to show that excessive charging does occur,” Sim said.
Citing a letter by an insurance company to a policyholder, Sim said those aged 46 to 50 now face a 50 per cent increase in medical insurance premiums from RM1,133 to RM1,699 annually since last July 1. Policyholders in other age groups are also subject to premium hikes.
“If the Ministry of Domestic Trade and Cost of Living (KPDN) can investigate ‘excessive profiteering’ on an increase of 10 sen for eggs, why can’t Bank Negara Malaysia (BNM) investigate increases of tens to hundreds of per cent for insurance premium hikes? Why can’t the authorities investigate if a rise in private hospital charges is ‘excessive profiteering’?”
The government MP told BNM, which regulates the insurance industry, not to dismiss the increase in health insurance premiums as a “business decision”.
Sim added that his team has received 71 complaints to date after launching their campaign against the increase in insurance premium and private hospital charges.
Since last September 1, BNM mandated insurers/ takaful operators (ITOs) offering medical and health insurance and takaful (MHIT) products to offer at least one product with a minimum 5 per cent copayment and/or an RM500 deductible. Any new medical reimbursement insurance/ takaful product designed must come with the minimum 5 per cent copay.
Both the central bank and insurance industry have claimed that copayments are necessary to curb medical inflation in Malaysia that hit 12.6 per cent last year. They also believe that people will choose copay policies with lower premiums than non-copay plans, instead of completely abandoning insurance coverage.
When necessity becomes luxury: Many torn over keeping insurance policies in Malaysia
Rising private medical insurance premiums are leaving policyholders outraged.
They are now forced to choose between two equally bitter pills: gritting their teeth and continuing with their coverage, or giving up their policies altogether.
Facebook user Julian Chong said his wife had to cancel her policy as the monthly premium had risen from RM300 (S$90) to RM700.
“The policy that was said to be fixed to the premium age of 80-plus increased… The insurance company issued a letter saying that the overall average claims by patients had increased, along with hospital bills,” he said.
Mr Chong accused insurance companies of being “relentless” in seeking to increase their profits.
“Bonuses and dividends to shareholders have increased,” he posted on Bayan Baru MP Sim Tze Tzin’s page, which has been highlighting the controversy surrounding the expected increase in medical insurance premiums.
Last week, Mr Sim said MPs had received dozens of complaints about rising health insurance premiums.
For executive Nurul Basha, 31, who has three children, not having insurance is not an option as her children are still young.
“I have three children aged between six and one and they do get sick every now and then,” she said.
“Having a medical card is essential because I cannot afford to pay for hospital charges on my own as they are getting expensive.
“I am currently paying RM300 for my girls and RM225 for my baby. As for now, there has been no update from my insurance agent or a letter, so we will have to wait and see.
“If the hike is not too much, we will still continue to pay or ask the agent for less coverage.”
On people not being able to pay their monthly premiums, Ms Nurul said it is likely to happen among those who do not receive any salary increments or who have additional expenses.
Assistant marketing manager April Wong, 32, from Kuala Lumpur, said if the price hike applies only to new policies and plans, people might not drop off as easily because the old policies would maintain the same premiums and coverage.
“While price hikes are not new, I disagree with the sudden increase in policy premiums,” she said.
“Wasn’t this anticipated when the policy was sold to me? I agreed to pay a consistent price to insure (myself against) my future risks. This sudden hike feels unfair to policyholders.
“The increase is significant. Imagine a basic policy costing around RM200. The additional amount is like another monthly phone bill.
“Individuals might manage but it’s too much for family breadwinners, especially those with multiple policies.”
Ms Wong said adjusting prices every three years might make sense from a business perspective but changing the price of existing contracts is problematic.
Mr Vijayendiran Subrama, who posts on X under the handle @vijaysubra, said Bank Negara Malaysia has to act seriously on the matter.
“The past few years, insurance companies have been increasing premiums like there is no tomorrow,” he tweeted.
“Many elderly (people) had to stop taking (on) or renewing their medical insurance.”
It was reported that medical insurance premiums are expected to rise by between 40 per cent and 70 per cent in 2025, following notices sent by insurance providers to policyholders citing the rising cost of medical care in private hospitals as the primary reason.
In a joint statement on Nov 28, the Life Insurance Association of Malaysia, Malaysian Takaful Association and General Insurance Association of Malaysia said they understand that these adjustments may cause concern, but they “remain committed to providing transparency and support during this time”.
The groups said that apart from the rising costs of medical treatment and increased utilisation of healthcare services, factors that led to rising premiums include the high prevalence of non-communicable diseases like diabetes which require long-term care, and an ageing population that has led to greater demand for medical care.
Bank Negara said in a statement on Nov 28 that it requires insurers and takaful operators (ITOs) to review their current repricing strategies to provide a more reasonable adjustment.
The central bank said this includes managing increases in premiums or contributions over time by taking into account the impact on policyholders or takaful participants. Takaful refers to a system of insurance that complies with Islamic religious law.
In addition, the central bank said ITOs are required to offer viable options for policyholders and takaful participants who are significantly affected by the higher premiums or contributions to continue having insurance or takaful coverage.
In their joint statement, the insurance companies agreed to “stagger” the premium increases and offer flexible premium payment plans.
Source : Straits Times
Malaysia’s life insurance sector to surpass RM77.3bil by 2028
The Malaysian life insurance industry could surpass RM77.3 billion by 2028, according to a recent analysis by GlobalData.
The firm expects the industry to grow at a compounded annual growth rate (CAGR) of 5.2 per cent over 2024–2028, from RM63.2 billion (US$13.9 billion) in 2024 to RM77.3 billion (US$17.2 billion), in terms of direct written premiums (DWP).
Meanwhile, insights from GlobalData’s Insurance Database estimated the industry to expand by 5.9 per cent in 2024.
This is driven by an uptick in consumer spending led by robust economic recovery, favorable regulatory reforms aiming to promote digitalization, and the country’s growing demographic trend of an aging population.
Its insurance analyst Manogna Vangari said the Malaysian economy had shown a robust growth of 4.2 per cent in the first quarter this year from the 2.9 per cent growth recorded in the fourth quarter of 2023.
“This growth was primarily attributed to heightened private expenditure and enhanced investment activities.
“As per GlobalData Macroeconomic forecast, the economy is further expected to grow at an annual average rate of 4.4 per cent over 2024-2026, which will support the growth of life insurance,” he added.
Endowment insurance, the largest line of business, is expected to account for a 77.3 per cent share in total life insurance DWP in 2024 and should grow at a CAGR of 5.1 per cent over 2024-2028.
According to GlobalData, increased interest rates and improved labor market conditions prompted a shift in consumer demand towards wealth accumulation products, which will support the growth of endowment insurance.
Vangari said a comprehensive policy document on licensing and regulatory framework for digital insurers and takaful operators released by Bank Negara Malaysia in July 2024 aims to foster the digital transformation of the insurance sector.
He added that the framework is part of the Financial Sector Blueprint 2022–2026, which seeks to promote inclusion, competition and efficiency through digitalisation.
“Favourable regulatory reforms will help in increasing the life insurance penetration rate in Malaysia (3.3 per cent), which was lower as compared to other Asian markets such as Taiwan (9.3 per cent), Japan (6.3 per cent) and Thailand (3.5 per cent) in 2023.
“Changing demographics and digitalization will prompt insurers to provide more competitive and tailored insurance policies that will help in improving the penetration rate,” he said.
Profiteering fears as Malaysians face punishing hike in health insurance
Malaysia’s central bank has instructed private medical insurers to keep down premium increases, as public anxiety mounts over alleged profiteering with rises of up to 70 per cent forecast for next year.
The rare intervention by the bank followed local media reports of Malaysians cancelling medical insurance policies after being unable to afford steep monthly premiums.
Instead, they are returning to government hospitals which are already struggling to cope with a lack of funding and chronic shortages of doctors and nurses, with many leaving the country for better opportunities abroad.
In a statement on Thursday, Bank Negara Malaysia (BNM) acknowledged the public’s concern and has instructed insurance operators to provide a remedy to the situation.
“[They] must also ensure the options provided are meaningful and provide additional measures to support affected policy owners,” the central bank said.
In July, BNM directed insurance companies to start pushing for policies that require patients to pay a percentage of their medical costs in advance before insurance kicks in as part of its effort to balance access to insurance coverage in the face of the sharp spike in cost of healthcare.
“[This] aims to help contain medical cost inflation in Malaysia by controlling the over-consumption of health services,” BNM said.
Life Insurance Association of Malaysia (LIAM) in a statement on the same day similarly acknowledged the public’s concern but stressed that its members saw an increase of 56 per cent in claims between 2021 to 2023.
“This surge is driven by various factors such as rising medical treatment costs, advancing health technology, and increasing use of health services, which makes the re-determination of premium and care prices an unavoidable step,” it said.
However, the proliferation of such co-payment schemes, reminiscent of health insurance practices in the United States, has stirred fear and anger over potential profiteering in the healthcare sector.
“All the big five insurance companies in Malaysia posted recorded profits last year and now they want to hike premiums?” X user @ruffleseed questioned.
In parliament on Tuesday, lawmakers urged the central bank to look beyond the premium hike as a business decision by the insurance companies.
Bayan Baru MP Sim Tze Tzin said that BNM should be able to investigate alleged profiteering.
“Why can’t the authorities investigate if the increase in private hospital charges is ‘excessive profiteering’?” Sim said at a press conference at parliament.
Insurance operator Allianz Malaysia posted strong financial results for Q1 2024, recording an insurance revenue of 1.34 billion ringgit (US$300 million), a 15.1 per cent increase from the previous year.
Meanwhile in August, KPJ Healthcare Berhad with 29 private hospitals across Malaysia announced its best ever quarterly results with a revenue of 930.6 million ringgit (US$209 million), an 18 per cent increase from the same quarter last year.
Source : SCMP
Rising Health Insurance Premiums Benefit Insurers And Hospitals
The recent media debacle about the rising premiums of health insurance and takaful (collectively called assurers) reflects ignorance from the public and regulators – Bank Negara Malaysia (BNM) and the Ministry of Health (MOH) – about the underlying issue.
This leads to their failure to identify an appropriate solution and to pass the buck from one party to another.
From a technical perspective, health assurance products are not classical assurance products, but medical consumption products due to the high certainty of claims.
In typical assurance products, assurance companies hedge their assurance fund against the policy owners’ claims. Typically, the probability and quantum of a claim are unpredictable, and companies are exposed to the risk of losing money.
The predictability of medical claims trends makes this business a finance administration business. It has some elements of a Ponzi scheme, where the assurance fund sufficiency depends on new enrollees.
The scheme enriches private hospitals and assurers make their predetermined administrator fees. They are not exposed to the assurance risk of losing money. Products are priced based on an average cost-plus basis.
Neither private hospitals nor insurers are concerned about rising premiums. Raising premiums mean insurers will maintain their revenue of 5 per cent to 10 per cent of the total premium collected, while hospitals can charge more.
According to Prudential’s Malaysia Claims Payout Data Report, they paid RM1.46 billion in medical claims in 2022, a 33.9 per cent increase from 2021. For January to June 2023, Prudential paid RM826 million, representing a 30.4 per cent increase over the same period in 2022. Assuming the total industry experience is 10 times more, this represents RM19.04 billion in claims that assurers pay private hospitals.
Hospitals and assurers maintain a symbiotic relationship. Rising premiums benefit both of them. There is no reason for either party to back down, as they must justify returns to their shareholders.
This relationship can be seen in a media statement by Dr Kuljit Singh, the president of the Association of Private Hospitals Malaysia (APHM), who defended insurance companies by saying that their decisions are justified.
The medical insurance business is like a potent drug. Everyone wants it. The number of permanent dropouts from the premium increase is expected to be small.
However, the number of new enrollees is expected to grow substantially as the population fears the burden of the high cost of hospital bills. The publicity alone of high hospital charges will encourage them to secure an assurance policy.
The often used phrase “medical inflation” is a misnomer. The rising cost is not due to inflation per se, but to controlled profiteering. How often do private hospitals invest in new hardware? Most drugs are not that expensive. Branded and established generics are plentiful.
Actual drug cost is the least concern in total hospital bills. Hospitals profit by inflating unregulated drug prices, besides encouraging and incentivising the utilisation of their diagnostic services.
They impose different rates for cash-paying patients, credit card users, and medical card users. The differences are substantial, as private hospitals see assurers as a goldmine. There is no basis to impose this differential pricing. Why isn’t the Ministry of Domestic Trade and Cost of Living (KPDN) investigating this?
The public is not blind. They can see the differences in the lifestyles of private and government doctors. KPJ Healthcare Berhad hit an historic RM1 billion quarterly revenue milestone for the third quarter this year. In 2024, its after-tax profit rose by 12 per cent compared to 2023. (RM242.62 million in 2024 vs RM217.44 million in 2023).
If the government chooses not to get its act together and fails to do a strategic intervention, Malaysia will become like the United States, where medical and insurance costs are super exorbitant and beyond the reach of the people.
The burden of the public health care system will increase multiple times. Our population size and country revenue are small compared to the US, so the impact on Malaysians is much worse. Our people will end up paying a higher insurance unit cost.
The solution lies in regulation and competition; only the government can create and maintain meaningful competition in the health care system. Drug prices need to be controlled. It doesn’t make sense to charge drug prices excessively. Why are generic drugs like paracetamol, which costs 1 sen/tablet, being priced at RM1.00 per tablet? Hospital diagnostic charges need to be controlled.
Government hospitals must be corporatised and be as efficient as private hospitals. They must break the profiteering cycle between insurers and hospitals by offering more reasonable prices. A corporatised hospital has the bargaining power to break the monopolistic relationship between insurers and APHM members.
Corporatisation and monetisation of hospital services are part of the National Healthcare Financing (NHF) agenda. It can start first before the government imposes a nationwide health contribution scheme.
The NHF is moving at a snail’s pace as policymakers grapple with multiple unnecessary studies. The government, specifically the Health Ministry, doesn’t seem to understand how to operationalise NHF.
NHF should not be an MOH project. It should be under the Ministry of Finance (MOF) or Khazanah.
The issue of rising insurance premiums is not an MOH or BNM problem. It’s a government problem. A parliamentary-level task force involving multiple agencies (BNM, MOH, KPDN, and the Inland Revenue Board) is needed to address the issue.
The government needs to start moving from these periodical theatrics. Data is plentiful within the many government agencies for them to evaluate the problem and offer a simple solution.
In conclusion, the way forward is for the government to corporatise government hospitals and compete with existing APHM member hospitals. The government must regulate drug and diagnostic services charges and make incentivising practices between doctors and hospitals illegal.
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