KUALA LUMPUR – The recent flash flood that hit Malaysia has affected many people nationwide. The flood risk is likely to persist during this monsoon season and it is of huge concern as many Malaysians are still uninsured against flood.
Only 4% of motor (comprehensive) policies and 30% of fire (material damage) policies have flood covers for 2021 (Year-To Q3 2021), according to statistics by the Insurance Services Malaysia (ISM).
“Although it is encouraging to see an increasing trend in motorists choosing to get flood cover from 1% in 2017 to 4% in 2021 (Year-To Q3), the number of flood cover under motor (comprehensive) policy is still very low.
“The purchase of flood cover under fire (material damage) policies has remained flat at circa 30% from 2017 to 2021 (Year-To Q3),” said Persatuan Insurans Am Malaysia (PIAM) in a statement on January 22.
All PIAM member companies are currently offering extension of flood coverage under the motor (comprehensive) and fire policies, subject to an additional premium.
“If you have an existing motor (comprehensive) or fire policy, you may have the option to include flood coverage, subject to an additional premium and at individual insurer’s underwriting discretion,” said PIAM.
“You are advised to review your policy to check on its scope of coverage. Your agent, broker or insurance company are more than willing to advise and help you should there be further enquiries regarding insurance coverage against flood or any natural disasters,” PIAM added.
According to Dr. Jessie Guo, Senior Economist, Swiss Re Institute in a recent PIAM webinar for its members on the Climate Emergency, Malaysia is ranked 47th out of 48 countries in the Climate Economic Index, that is in terms of vulnerability to climate change.
“Climate change will have an impact on the Malaysian insurance sector, with an estimated loss from fluvial and coastal floods increasing by 15-65% by 2050.
“Therefore, as a precautionary measure, Malaysians are advised to ensure that their vehicles, assets and interests are adequately protected for natural calamities like flood which is occurring on more frequent basis due to the effects and fallout from the global climate crisis,” PIAM concluded.