KUALA LUMPUR, Nov 23 — Malaysia’s general insurance industry has recorded an increase in gross direct premiums of 7.3 per cent to RM10.5 billion for the first half (1H) 2023 compared with the corresponding period in the previous year, said the General Insurance Association of Malaysia (Piam).
In a statement, the association said that despite the positive trajectory, underwriting profit had experienced a contraction of 37.8 per cent, settling at RM500 million.
“This decline is largely due to a contraction in profitability for the motor and fire lines of business. Specifically, the loss for motor portfolio deteriorated by RM200 million compared to the same period last year, due to deterioration of motor claim experience closer to pre-pandemic level and rising prices of vehicle spare parts in Malaysia,” it said.
On the other hand, Piam said various flood events and rising reinsurance costs have adversely impacted the overall profitability of the fire portfolio.
“Motor retains its position as the largest line of business at 44 per cent share of the total premium,” it said.
However, Piam said that despite a commendable eight per cent growth in gross direct premiums, reaching RM4.6 billion in the 1H 2023, motor insurance recorded an underwriting loss of RM54 million with net claims incurred ratio deteriorating to 67.1 per cent, reverting towards pre-pandemic levels.
Meanwhile, it said that following the rising flood events, the take-up rate of flood optional coverage within the Motor and Fire policies portfolios increased by two per cent to 14 per cent and 33 per cent, respectively.
Regarding claims, Piam said the general insurance industry had a daily claims payout close to RM23 million.
“The average daily claims payout in the 1H 2023 has increased by 23 per cent from full year 2022.
“For 1H 2023, motor daily claims payout increased to nearly RM16 million per day, the highest even compared to the pre-pandemic period,” it added. — Bernama
