PIAM: General insurance industry grows 4.8% in 2025, posts RM1.2 bil underwriting profit

KUALA LUMPUR (May 6): Malaysia’s general insurance industry posted an underwriting profit of RM1.2 billion for 2025, up 12.1% from RM1.04 billion in 2024, largely driven by stronger performance of the non-motor insurance businesses.

This came as the industry reported a 4.8% year-on-year increase in gross written premiums to RM24.2 billion in 2025, compared with RM23.1 billion in 2024.

The non-motor businesses comprise the fire; marine, aviation and transit (MAT); and personal accident segments. Of the total underwriting profit, RM700.8 million was generated by fire insurance, RM108.1 million by MAT and RM313 million by the personal accident insurance segments.

Despite the broader industry growth, the motor insurance segment remained loss-making with underwriting losses amounting to RM289.3 million as claims and expenses continued to outpace premiums collected.

The combined ratio for motor insurance stood at 103% in 2025, marking the fourth consecutive year the segment remained above the 100% threshold.

The combined ratio is a profitability metric for insurance companies, with a ratio above 100% indicating a segment is paying out more in claims and administrative expenses than it is earning from premiums.

The last time the motor segment was profitable was during the Covid-19 period in 2020 and 2021, said General Insurance Association of Malaysia (PIAM) CEO Chua Kim Soon during the industry’s 2025 performance briefing on Wednesday.

Motor insurance and fire insurance remained the two largest general insurance segments, accounting for a 45.2% and 20.9% share respectively.

Fire insurance registered a 6.9% premium growth to RM5 billion, up from RM4.7 billion last year, supported by sum-insured inflation on residential sub-sales. The segment reported a combined ratio of 69.5% in 2025, a slight increase compared to 68.2% in 2024.

MAT’s premium fell 2.2% to RM1.79 billion in 2025, from RM1.83 billion last year, due to moderation in offshore oil-related and cargo businesses. The segment’s combined ratio rose to 73.1% from 63.1% in 2024, dragging its underwriting profit down by 49.7% to RM108.1 million.

Personal accident insurance, meanwhile, saw a 12.2% increase in gross written premium to RM1.6 billion in 2025, mainly driven by higher uptake of travel insurance. The segment’s combined ratio stood at 75.8% in 2025, down from 82.2% in 2024.

Looking ahead, Chua said the industry does not expect motor insurance losses to worsen this year, as insurers are actively managing spare parts inflation and repair costs through collaboration with industry partners. However, he noted that court awards for bodily injury claims remain difficult to predict and control.

“I don't see that it will change radically. It will still be around this kind of number. Premiums [for motor insurance] are quite well contained and we tried to manage the inflationary cost of spare parts while court awards are a bit more difficult because it's all dependent on the lawyers and the judges.

“But in terms of things that are in our hands — new repair methods, spare parts cost and labour costs — those are things that we can work with our partners,” he said.

Chua also flagged that inflation for spare parts has been trending higher, though it remains in the single-digit range, mainly driven by imported components for certain vehicle models, notably the Proton Saga and X50.

In contrast, the cost of locally manufactured spare parts has remained relatively well contained, he noted.

Overall, the severity of private car claims increased by 20% to RM8,831 in 2025, from RM7,381 in 2024.

Geopolitical tensions in the Middle East have so far had a limited direct impact on Malaysia’s motor insurance segment, Chua added.