Malaysia: Insurance market expected to rebound next year from COVID-19 impact
Source: Asia Insurance Review | May 2020
The COVID-19 pandemic will cripple the growth of the conventional insurance and takaful industry this year before any rebound can be anticipated in 2021, said RAM Ratings.
Based on statistics from past crises, new business for the life insurance sector contracted 4.6% during the global financial crisis in 2008 and 10.2% amid the Asian financial crisis in 1998.
Despite short-term growth challenges, RAM Ratings expects the life and family takaful businesses to be supported by Malaysia’s favourable demographics and healthy demand for medical coverage in the long run – further lifted by significant medical cost inflation.
For the general insurance sector it expects premiums and takaful contributions to contract this year because of the challenging economic landscape and the gradual effects of tariff liberalisation on the motor and fire branches. A