Kuala Lumpur: Underfunding in Malaysia’s public health sector remains a key challenge, with healthcare expenditure standing at about four per cent of gross domestic product (GDP), according to Malaysian Reinsurance Bhd (Malaysian Re).
According to BERNAMA News Agency, this figure is lower than the six to seven per cent average in comparable economies, as highlighted in Malaysian Re’s annual research publication, Malaysian Insurance Highlights (MIH) 2025. The national reinsurer emphasized that the private sector is also facing hurdles, such as non-aligned interests between policyholders, insurers, and healthcare providers. These misalignments have led to concerns over the overconsumption of healthcare services and inflated billing.
Malaysian Re, a wholly owned subsidiary of MNRB Holdings Bhd, underwrites all classes of general reinsurance business and general and family retakaful businesses through its retakaful division. Its president and chief executive officer, Ahmad Noor Azhari Abdul Manaf, stressed the urgent need for new healthcare provision and financing strategies in Malaysia to create a more efficient and sustainable healthcare system. He noted that the insurance industry plays a crucial role in this transformation and must innovate its products to address consumer needs while mitigating rising healthcare costs. Collaboration with regulators and healthcare stakeholders will be essential to sustain progress and tackle these challenges effectively.
The sixth edition of MIH provides an in-depth analysis of the challenges associated with healthcare financing in Malaysia’s dual public and private health system. It explores emerging trends in medical and health insurance and strategies to ensure Malaysians have access to quality and affordable healthcare. The report also highlights key factors contributing to Malaysia’s escalating healthcare costs, including medical inflation, an ageing population, and the increasing prevalence of noncommunicable diseases.
The findings of MIH 2025 are derived from structured interviews and insights from industry experts, offering valuable perspectives on the complexities of healthcare financing and opportunities available for reform. Ahmad Noor Azhari emphasized that access to healthcare is a fundamental right underpinning wellbeing, livelihoods, and economic stability. He noted that rising healthcare costs, coupled with inadequate public sector funding and misaligned interests within the private sector, pose significant challenges to establishing a sustainable healthcare financing framework. Recognizing the importance of this issue, Malaysian Re has chosen to focus on this topic for MIH 2025.