SINGAPORE, Aug 4 (Bernama-BUSINESS WIRE) -- AM Best is maintaining a stable market segment outlook on the Malaysian non-life insurance industry due to its underwriting discipline and the market’s recovery following the economic fallout from COVID-19.
The Best’s Market Segment Report, “Market Segment Outlook: Malaysia Non-Life Insurance,” states that non-life gross written premium rose by 4.0% to MYR 21.97 billion (USD 4.95 billion) in 2021, 44% of which was driven by the general takaful segment. The increase follows a contraction in non-life premiums in 2020 and was driven by a recovery in most lines of business, especially fire, engineering and the growing motor takaful segment. Over the near to medium term, AM Best expects the segment’s growth to be supported by the country’s economic recovery and increased insurance penetration. Whilst economic growth has rebounded with the lifting of prolonged COVID-19-related social and business restrictions, the increased adoption of digitalisation has improved the ease of policy subscriptions and is helping to raise insurance penetration.Prospectively, key lines of business, in particular motor and fire insurance are expected to drive the growth of the non-life insurance segment. Following the end of movement restrictions and lock-downs, motor insurance business is likely to expand over the near term, supported by growing new vehicle sales."
“Given the hardening of reinsurance rates for fire coverage in recent periods, primary insurers have been moderately increasing the pricing for fire,” said Susan Tan, financial analyst, AM Best. “Price increases for the fire line peaked in the fourth quarter of 2021 following the December flood event in Malaysia.”
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