What steps are taken to protect health insurance policyholders?

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Steps taken to protect health insurance policyholders include rules on claims handling, limits on coverage cancellation, and a free dispute channel

Insurance and takaful operators are required to protect health insurance policyholders through regulated claims practices and restrictions on how coverage can be cancelled or refused. In Parliament, Deputy Finance Minister Liew Chin Tong said all medical and health insurance and takaful (MHIT) products must comply with the regulations in the MHIT Business Policy Document issued by Bank Negara Malaysia. He also said policyholders can first raise complaints with their operator and, if still dissatisfied, submit disputes to the Financial Market Ombudsman Service (FMOS) free of charge via BNMLINK.
MHIT products must follow Bank Negara Malaysia regulations
Liew said MHIT products are subject to rules in the MHIT Business Policy Document issued by Bank Negara Malaysia. This regulatory framework governs how insurance and takaful operators handle medical and health coverage and claims. He linked these requirements to strengthening protection for policyholders who have concerns over rejected claims.
Operators cannot cancel or refuse renewal just because of a claim or health issues
The deputy minister stated that insurance and takaful operators cannot arbitrarily cancel a policy or takaful certificate unilaterally. He added that operators also cannot terminate or refuse to renew coverage solely because the policyholder has made a claim or experienced health issues after securing the coverage. This is intended to prevent coverage from being withdrawn on the basis of post-coverage health events or claims activity.
Claims must be reviewed fairly under contractual scope and medical necessity
Liew said operators are responsible for reviewing and managing claims fairly in line with contractual terms. This includes ensuring claims fall within the scope of coverage and are medically necessary. He also said claim reviews are conducted using standard treatment protocols that comply with clinical practice guidelines, including those issued by the Ministry of Health.
Most hospitals review claims before treatment, and disputes can go to FMOS for free
For most hospitals, Liew said the claim review is carried out before treatment is administered, so policyholders do not have to bear unapproved costs retrospectively. For complaints, he said policyholders can contact the operator first; if still dissatisfied, they can contact BNMLINK and submit the dispute to FMOS free of charge. Liew also pointed to industry data showing an average claim approval rate of over 90 per cent in 2025, with more than one million claims approved each year.

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What steps are taken to protect health insurance policyholders?

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