Malaysia’s general insurance market is projected to grow to MYR31.8 billion (US$7.2 billion) by 2029, up from MYR24.6 billion (US$5.5 billion) in 2025, according to new data from GlobalData. This represents a compound annual growth rate (CAGR) of 6.6%, supported by stronger pricing, economic recovery, increased demand for catastrophe cover, and rising medical costs.
Key Market Drivers
In 2024, motor, property, and personal accident & health (PA&H) insurance made up 82.6% of the total premium volume, confirming their central role in Malaysia’s insurance landscape.
Motor insurance is forecast to remain the largest segment in 2025, contributing 44.7% of total premiums. This is driven by more vehicle registrations and rising road accidents. The Ministry of Transport reported that road accidents lead to approximately 1.3 million deaths worldwide each year.
Vehicle sales in Malaysia increased 2.1% in 2024 to 816,747 units, according to the Malaysian Automotive Association (MAA). Meanwhile, electric vehicle (EV) registrations jumped 64%, accounting for 2.54% of total vehicles. These trends are expected to influence future insurance product development.
Property and Health Insurance on the Rise
Property insurance, the second-largest segment, is set to make up 26.2% of premiums in 2025. Its growth, projected at 5.8%, is linked to active construction and frequent flooding, boosting demand for fire policies with flood coverage.
Personal accident and health insurance is expected to contribute 11.4% to the market in 2025. Medical inflation—estimated at 15% in 2024—along with an aging population and the rise in chronic illnesses, continues to push demand. GlobalData predicts a 7.6% CAGR for PA&H insurance from 2025 to 2029.
“High healthcare costs and increased health awareness are driving demand,” said Swarup Kumar Sahoo, Senior Insurance Analyst at GlobalData. “Premiums will rise further due to aging populations, more non-communicable diseases, and pressure on public healthcare.”
Regulatory Changes and Market Inclusion
To expand access, Bank Negara Malaysia (BNM) is pursuing reforms under its Financial Inclusion Framework (2023–2026), aiming to raise insurance and takaful penetration from 4.4% to about 5% by 2026. Efforts include promoting microinsurance, microtakaful, and expanding digital channels.
BNM has also capped annual health insurance premium increases at 10% for 2024–2026. Additionally, the upcoming Risk-Based Capital 2 (RBC2) framework, launching in January 2027, is expected to strengthen the industry’s financial stability.
Smaller Segments and Sector Risks
About 17.7% of Malaysia’s general insurance market consists of financial lines, liability insurance, and marine, aviation, and transit (MAT) coverage. These segments face ongoing pricing pressures and economic uncertainty.
Sahoo noted that climate risks, increased awareness, and regulatory updates will shape the market’s direction, although external risks like trade policy changes may impact growth.
2025 Industry Outlook
The General Insurance Association of Malaysia (PIAM) reported that gross written premiums (GWP) reached MYR23.1 billion (US$5 billion) in 2024, marking a 6.9% increase year-on-year. This was led by stronger demand in motor and fire insurance, along with steady growth in marine, aviation, and transit.
Motor insurance premiums rose MYR651.1 million (6.7%), reflecting higher vehicle numbers. Fire insurance saw a MYR258.5 million (5.8%) increase, partly due to rising material and rebuilding costs.
PIAM emphasized the industry’s focus on sustainable underwriting, EV-related product innovation, and climate resilience to address ongoing challenges like inflation and natural disasters.
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