Great Eastern Holdings yesterday said that it is in discussions with the relevant authorities in Malaysia on possible options relating to the satisfaction by its wholly owned Malaysian subsidiary, Great Eastern Life Assurance (Malaysia) [GELM], of the prevailing foreign ownership requirements applicable to insurance companies in Malaysia.
Such options include, inter alia, GELM making a certain contribution to a special insurance development trust fund which may take the form of a B40 Health Protection Fund, which would be for those in the low income category.
The discussions on the options are on-going at this stage and details have yet to be finalised. Based on the options currently being considered, Great Eastern Holdings believes there will not be a material impact on the earnings of GELM and Great Eastern Holdings, according to a company statement.
Great Eastern Holdings in its statement was making a reference to the Budget speech by the Minister of Finance of Malaysia on 2 November 2018, in which the Minister, Mr Lim Guan Eng, announced that GELM would contribute initial seed funding of MYR2bn ($480m) to a proposed B40 Health Protection Fund.
In the Budget address, Mr Lim said, “In partnership with the private insurance industry, the government will pilot a national B40 Health Protection Fund to provide free protection against the top four critical illnesses for up to MYR8,000 and up to 14 days of hospitalisation income cover at MYR50 per day starting 1 January 2019.
“In other words, hospitalisation income of MYR700 per annum is available. We are grateful to Great Eastern Life Insurance for agreeing to contribute the initial seed funding of MYR2bn to this Fund to be managed by Bank Negara Malaysia. We are expecting the fund size to grow with more partnership and contributions with other insurance companies.”