Kuala lumpur: Malaysia’s general insurance industry experienced a 4.0 per cent year-on-year growth in the first half of 2025, with gross written premiums (GWP) increasing to RM12.3 billion from RM11.8 billion. This growth was primarily fueled by the motor and fire insurance segments, as reported by the General Insurance Association of Malaysia (PIAM).
According to BERNAMA News Agency, PIAM’s chief executive officer, Chua Kim Soon, highlighted in the half-year performance briefing that the motor insurance segment contributed an additional RM283 million in premiums. This increase was bolstered by a significant 35.6 per cent rise in hybrid and electric vehicle sales. The fire insurance segment also added RM244 million, driven by a 3.7 per cent increase in commercial property policies, reflecting consistent demand in the property insurance market.
The industry reported an underwriting profit of RM629 million, up from RM476 million in the same period of 2024, with the combined ratio improving to 92.1 per cent from the previous 93.7 per cent. The claims ratio saw a slight decline to 57.4 per cent, while management expenses decreased to 34.7 per cent. Chua noted that despite challenges from the motor and medical health insurance segments, the industry has shown resilience with steady premium growth and disciplined underwriting.
Chua pointed out that external factors, such as geopolitical tensions and inflation, continue to affect market conditions. He mentioned the impact of United States tariffs, which have affected Malaysia’s export-driven economy, with around half of manufacturers experiencing up to a 10 per cent impact, and a third seeing impacts between 10 and 30 per cent.
Addressing climate risks, Chua emphasized that Malaysia’s protection gap remains wide, with low insurance coverage despite frequent weather-related disasters. He referenced the significant floods in 2021, which caused between RM5.3 billion and RM6.5 billion in losses, while insurance cover accounted for only 20 to 30 per cent.
The fire insurance segment saw a 10.4 per cent year-on-year increase in premiums to RM2.6 billion, driven by growth in commercial properties like warehouses, office towers, and data centres, including the KL1 IBX Data Centre in Cyberjaya. Motor insurance remained the largest segment, making up 42.8 per cent of total GWP, followed by fire insurance at 21.1 per cent.
Chua also addressed the profitability pressures on the motor business due to rising accident rates and inflationary costs. Malaysia has seen an increase in road accidents, with about 115 cases per 100,000 people, and the costs of spare parts rising by an average of 10 per cent annually since 2021. Personal injury awards have also increased, with more cases exceeding RM1 million.
Looking ahead, Chua expressed expectations for moderate growth for the full year, supported by expansion in commercial property insurance and recovery in personal accident coverage as travel activity improves. The industry’s focus will be on enhancing consumer awareness, promoting better risk protection, and advancing digital adoption through partnerships with e-wallets and Insurtech platforms.