Kuala lumpur: 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.

According to BERNAMA News Agency, the Best's Market Segment Report, titled 'Market Segment Outlook: Malaysia Non-Life Insurance,' indicates that the non-life sector remains well-positioned for continued growth. This positive outlook persists even as Malaysia's real GDP growth is expected to moderate in the near term due to global economic challenges. Bank Negara Malaysia, the central bank and primary regulatory authority, is focused on enhancing insurance and takaful penetration, which currently remains in the low single digits for the non-life segment.

The report highlights several drivers for the anticipated growth in the insurance market. These include a projected increase in demand for digital insurance solutions and coverage against natural catastrophes. Additionally, premium rate hikes are expected as a response to high inflation and rising claims frequency. The liberalisation of tariffs is also seen as a crucial factor that could foster product innovation, elevate service quality, align pricing with actual risks, and boost market efficiency.