The government needs to further intensify programmes and initiatives on financial planning literacy among low-income families (B40) in Malaysia, so that they are aware of the importance of insurance and takaful.
Life Insurance Association of Malaysia (LIAM) President Loh Guat Lan said this is because the rate of penetration of insurance and takaful products in the country is still very low and far from the stipulated target.
“Insurance is affordable, it’s not really a luxury or expensive, it can be tailored according to budget. That’s what LIAM is trying to do to educate this group (B40)... send the message to them that financial planning is very important for everybody.
“Only some of them have insurance and takaful. As such, the government and LIAM are working together to come out with Perlindungan Tenang Voucher initiative. That means the government pays (for) this, then they (eligible individuals) come to us (insurance agency) to get insurance coverage,” she told Bernama recently.
To expand social protection for the low-income group, the government has taken the initiative by introducing the Perlindungan Tenang Voucher (PTV) programme worth RM175 million (US$39.9 million), which will benefit 8.7 million Bantuan Prihatin Rakyat recipients.
The PTV, which began with a value of RM50 last year, has been increased to RM75 this year to enable more Malaysians to continue with their life insurance coverage through the benefits of the Perlindungan Tenang insurance product.
Ms Loh said the idea for the PTV initiative was not only for the low-income group, but also to create awareness about the importance of financial planning, which encompasses all age groups.
Meanwhile, LIAM CEO Mark O’Dell hoped that the new government would continue the PTV initiative, which he described as being beneficial to the people.
“Insurance is about consistency... you need it, you are well protected. I think we need to carry on with the education and initiative until people are really aware of the importance of insurance.
“We started well, we know how to create awareness and get them the protection accordingly. We also did a lot of roadshows at the grassroots level to educate them about financial planning,” he added.