The life insurance market in Malaysia is forecast to reach $17.2 billion direct written premiums (DWP) in 2028, garnering a compound annual growth rate (CAGR) of 5.2% from 2024 to 2028, GlobalData results showed.
GlobalData also forecasts a 5.9% growth in Malaysia’s life insurance market in 2024, driven by increased consumer spending due to economic recovery, regulatory reforms promoting digitalisation, and the ageing population.
“The Malaysian economy exhibited a robust growth of 4.2% in the first quarter of 2024 from the 2.9% growth recorded in the fourth quarter of 2023,” Ms Manogna Vangari, Insurance Analyst at GlobalData said in the report.
“This growth was primarily attributed to heightened private expenditure and enhanced investment activities. As per GlobalData Macroeconomic forecast, the economy is further expected to grow at an annual average rate of 4.4% over 2024–26, which will support the growth of life insurance,” she said.
Endowment insurance, the sector’s largest segment, is projected to represent 77.3% of total life insurance DWP in 2024.
Following a 7.8% rise in linked insurance premiums and a 4.4% increase in non-linked premiums in 2023, demand for endowment insurance is expected to grow at a 5.1% CAGR from 2024 to 2028.
“Favourable regulatory reforms will also support life insurance growth. In July 2024, the Central Bank of Malaysia released a comprehensive Policy Document on Licensing and Regulatory Framework for Digital Insurers and TakafulOperators, aiming to foster the digital transformation of the insurance sector,” said Ms Vangari.
“This framework is part of the Financial Sector Blueprint 2022–2026, which seeks to promote inclusion, competition, and efficiency through digitalisation,” she added.
Whole life insurance, accounting for a projected 7.5% share of DWP in 2024, is expected to grow by 2.3% that year, fueled by Malaysia’s ageing population.
Term life insurance, the third-largest segment, is projected to hold a 4.4% share of DWP in 2024. Its premiums grew by 5% in 2023, down from 5.1% in 2022, reflecting consumer spending adjustments amid rising inflation, reported Insurance Asia.