Best’s Market Segment Report: AM Best Maintains Stable Outlook on Malaysia’s Non-Life Insurance Segment
Released on: Tuesday, 16 Dec 2025 10:08AM
SINGAPORE, Dec 16 (Bernama-BUSINESS WIRE) -- AM Best is maintaining a stable outlook on Malaysia’s non-life insurance segment, citing regulatory initiatives designed to increase insurance penetration and phased de-tariffication of motor and fire insurance.
The Best’s Market Segment Report, “Market Segment Outlook: Malaysia Non-Life Insurance,” states that the non-life sector remains well-positioned for continued growth, even as the country’s real GDP growth is forecast to moderate in the near term amid global economic headwinds. Bank Negara Malaysia, the country’s central bank and lead regulator, continues to prioritise broader insurance and takaful penetration, currently in the low single digits for non-life. Additional insurance market growth drivers include an expected rising demand for digital insurance and natural catastrophe coverage, along with premium rate hikes driven by high inflation and increasing claims frequency. The report also notes that tariff liberalisation should drive product innovation, improve service quality, align pricing with underlying risks, and enhance market efficiency.
“Since July 2016, Bank Negara Malaysia has progressively liberalised motor and fire insurance tariffs, introducing greater pricing flexibility in phases to support the transition to risk-based pricing,” said Sin Yee Chuah, senior financial analyst, AM Best. “While de-tariffication is expected to put pressure on pricing over the near to medium term, it strengthens the long-term sustainability of the industry.”
Ongoing regulatory measures are expected to help mitigate medical inflation and improve underwriting profitability of the health segment, while rising climate risks, particularly from severe flood events, are prompting regulatory actions to strengthen insurer preparedness.
“Collectively, these initiatives by Malaysia’s regulator are expected to reinforce the sector’s long-term financial resilience and risk management capacity,” said Victoria Ohorodnyk, director, head of analytics, AM Best.
To access the full copy of this market segment report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=361060.
To view current Best’s Market Segment Outlooks, please visit http://www.ambest.com/ratings/RatingOutlook.asp.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.
Copyright © 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
View source version on businesswire.com: https://www.businesswire.com/news/home/20251215210013/en/
Contact
Sin Yee Chuah
Senior Financial Analyst
+65 6303 5022
sinyee.chuah@ambest.com
Victoria Ohorodnyk
Director, Head of Analytics
+65 6303 5020
victoria.ohorodnyk@ambest.com
Christopher Sharkey
Associate Director, Public Relations
+1 908 882 2310
christopher.sharkey@ambest.com
Cynthia Ang
Senior Industry Research Analyst
+65 6303 5026
cynthia.ang@ambest.com
Source : AM Best
--BERNAMA
The Best’s Market Segment Report, “Market Segment Outlook: Malaysia Non-Life Insurance,” states that the non-life sector remains well-positioned for continued growth, even as the country’s real GDP growth is forecast to moderate in the near term amid global economic headwinds. Bank Negara Malaysia, the country’s central bank and lead regulator, continues to prioritise broader insurance and takaful penetration, currently in the low single digits for non-life. Additional insurance market growth drivers include an expected rising demand for digital insurance and natural catastrophe coverage, along with premium rate hikes driven by high inflation and increasing claims frequency. The report also notes that tariff liberalisation should drive product innovation, improve service quality, align pricing with underlying risks, and enhance market efficiency.
“Since July 2016, Bank Negara Malaysia has progressively liberalised motor and fire insurance tariffs, introducing greater pricing flexibility in phases to support the transition to risk-based pricing,” said Sin Yee Chuah, senior financial analyst, AM Best. “While de-tariffication is expected to put pressure on pricing over the near to medium term, it strengthens the long-term sustainability of the industry.”
Ongoing regulatory measures are expected to help mitigate medical inflation and improve underwriting profitability of the health segment, while rising climate risks, particularly from severe flood events, are prompting regulatory actions to strengthen insurer preparedness.
“Collectively, these initiatives by Malaysia’s regulator are expected to reinforce the sector’s long-term financial resilience and risk management capacity,” said Victoria Ohorodnyk, director, head of analytics, AM Best.
To access the full copy of this market segment report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=361060.
To view current Best’s Market Segment Outlooks, please visit http://www.ambest.com/ratings/RatingOutlook.asp.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.
Copyright © 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
View source version on businesswire.com: https://www.businesswire.com/news/home/20251215210013/en/
Contact
Sin Yee Chuah
Senior Financial Analyst
+65 6303 5022
sinyee.chuah@ambest.com
Victoria Ohorodnyk
Director, Head of Analytics
+65 6303 5020
victoria.ohorodnyk@ambest.com
Christopher Sharkey
Associate Director, Public Relations
+1 908 882 2310
christopher.sharkey@ambest.com
Cynthia Ang
Senior Industry Research Analyst
+65 6303 5026
cynthia.ang@ambest.com
Source : AM Best
--BERNAMA