KUALA LUMPUR: While most businesses were devastated by Covid-19 last year, the insurance industry bucked the trend and is expected to continue growing this year.
However, this does not mean more people are opting for insurance coverage.
With economies recovering worldwide, insurance companies that invested their funds are starting to reap the benefits.
Malaysian Takaful Association (MTA) chief executive officer Mohd Radzuan Mohamed said although the industry is doing better, many people are still wary of getting insurance coverage.
Among his reasons for this is a lack of awareness on the importance of being insured.
“Sadly, those most vulnerable to financial loss are the ones least covered by insurance,” he said.
Citing a recent example, he said many victims were devastated by the damage caused by the 2021 floods and suffered financial losses but not many were covered by insurance.
A form of risk management primarily used to hedge against the risk of contingent or uncertain loss, insurance or takaful is a means of protection from financial difficulties.
To ensure insurance coverage is accessible and affordable for all, the government, together with the takaful and insurance industry, has been offering eligible Bantuan Keluarga Malaysia recipients a RM75 Perlindungan Tenang Voucher (PTV) since Jan 1.
However, Mohd Radzuan said not many of those eligible for the voucher have applied.
Many are sceptical of takaful and insurance and some think that it is a luxury and not a necessity.
Shahrizal Ahmad, 38, from Klang, said he does not bother with insurance or takaful because he has other more important expenses in mind.
“I need to focus my spending on my family. With insurance, I have to pay (premiums) today and my family will have to wait for the day I die before they get any money. They need money now, not then,” he told theSun.
Asked if he plans to apply for the PTV, Shahrizal said he is not planning to do so.
“I get it free this time. What about the following year? I might have to pay for it and that is money I don’t have.”
Meanwhile, Jeram assemblyman Shaid Rosli said he is not aware of the scheme.
“I am willing to talk to MTA and have them open a booth here for those eligible to get more information on PTV,” he told theSun.
Shaid also said most B40 families do not have insurance because of the monthly or annual premiums.
“Most of them can’t afford basic necessities and their priorities are different,” he said.
Meanwhile, Mohd Radzuan reminded Malaysians not to be afraid of insurance or takaful premiums.
“Get the right information from the right people and you will get the help needed.”
He added that insurance knowledge in Malaysia is not the problem but creating more awareness and making insurance accessible and affordable for the people is the main goal.
“The government is on the right track by providing PTV to those eligible and those not eligible may still contact any insurance company and discuss their financial planning needs,” he said.
On increasing awareness on PTV, Mohd Radzuan said the industry will work with non-governmental organisations to reach out to target groups.
He stressed consumers must understand that insurance coverage can be tailored to accommodate their needs and it does not necessarily have to be expensive.