Insurance, takaful industry commits to private-public partnership to manage Covid-19

by S BIRRUNTHA / pic by TMR FILE

THE insurance and takaful industry have announced that it is fully supportive of the government’s call on private and public partnership to manage the increasing cases of Covid-19 patients.

In a joint statement today, the Life Insurance Association of Malaysia (LIAM), General Insurance Association of Malaysia (PIAM) and Malaysian Takaful Association (MTA) said pandemic-related risks are generally not covered under any insurance and takaful plans worldwide.

It added that the exclusion stems from the difficulty in pricing for coverage relating to an event like a pandemic that may occur once in a lifetime, having an incalculable impact and cost.

“Covid-19 is a pandemic hence it is not insured or covered under medical and health insurance/takaful benefits.

“Nevertheless, in response to the nation’s immediate need in the early stage of the pandemic in 2020, majority of life insurers and takaful operators have provided supplementary benefits such as daily hospital income to be paid to the affected policyholders/certificate holders,” the associations said.

It also noted that it is currently working with the Ministry of Health and Bank Negara Malaysia to explore avenues where insurers/takaful operators can ease some of the expenses of patients whose conditions are required to be treated in private hospitals under the present circumstances.

It added that it is supportive of protecting the policyholders’/certificate holders’ interests and contributing to the success of the private and public partnership in winning the battle against Covid-19 pandemic.

Additionally, the associations said that efforts were swiftly galvanised by the insurance industry to put in place various relief measures to help policyholders/certificate holders cope with the financial impact of the pandemic.

Among others, it said this included the deferment of policy premiums/takaful contributions that have benefited over 1 million policyholders/certificate holders with premium/contributions valued over RM1.6 billion.

A total of RM8 million Covid-19 Testing Fund (CTF) was also set up in March 2020 to enable medical and health insurance policyholders to undergo testing for Covid-19.

In addition to industry-wide efforts, individual insurers and takaful operators have also rolled out various schemes to aid policyholders/certificate holders.