KUALA LUMPUR – Over a quarter of Malaysian consumers are feeling anxious and “overwhelmed” when it comes to their finances as a result of COVID-19, with 6% of those unable to cope, according to a recent Swiss Re consumer survey.
Amid the financial stress caused by COVID-19, the number of people in Malaysia who feel well covered by insurance and Takaful policies was the highest in the surveyed Southeast Asia markets with 35% feeling mostly or completely covered and only 9% not feeling at all covered.
“There is no doubt the pandemic has brought considerable and consistent stress to Malaysian families,” said Marcel Omar Papp, Head Reinsurance Malaysia Conventional & Retakaful.
“However, the survey tells us that Malaysian consumers are also least active in seeking out new policies, making claims or concerned about reaching out to their insurers and Takaful operators than their Southeast Asian counterparts, suggesting a sense of stability when it comes to accessing insurance and Takaful in Malaysia.”
The Swiss Re commissioned poll of 500 residents in the Klang Valley was conducted by global market research company, Ipsos, in May 2020. The same survey was conducted in three other Southeast Asian markets: Indonesia, Thailand and Vietnam. The data was collected in English, Malay or simplified Chinese via smartphone, laptop or tablet devices.
“When asked about the value of insurance and Takaful, 7 in 9 respondents (78%) agree that it eased stress for them during a financially difficult time,” continued Papp.
The survey showed that insurers and Takaful operators had been proactive by reaching out to consumers to offer health advice and discuss flexible options.
“It’s pleasing to see Malaysian insurers and Takaful operators reaching out to consumers during this time to remind customers of available support, payment flexibility and additional coverage in their existing policies when they need it most. Our survey shows over 50% of consumers were contacted by their insurers and Takaful operators,” said Papp.
When asked about their intention to switch providers, more than half (58%) would prefer to stay with their existing provider for new policies or renewals. And when it comes to choosing another insurer or Takaful operator many consumers looked for additional coverage or the ability to process online. These came in behind pricing as an important factor to Malaysians.
“Like all other Southeast Asian markets, post-COVID-19 will see many customers more likely to purchase insurance and Takaful online, but with the highest proportion (35%) of consumers still prefer to seek advice from an agent in Malaysia, there are still barriers to overcome” said Papp.
“This is a clear opportunity for the industry to refine the digital customer experience by offering support at various touch points, such as providing a hybrid service model with human support in a digitalised environment.”
COVID-19 has clearly had an impact on consumers’ priorities with many Malaysians citing an increased interest in medical or health insurance (51%); critical illness (44%); and life insurance/Family Takaful (37%). Respondents also said a faster claims process (64%) and more flexible conditions (59%) were necessary to deal with any health crisis in the future.
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