When choosing medical insurance or takaful, consumers naturally assume that a higher annual limit means better protection. A plan offering RM1 million or RM3 million may seem to provide better value than one offering RM100,000.
But the annual limit is only one part of the picture. The more important questions are: Does the coverage meet my healthcare needs? What am I actually paying for? And can I afford to maintain my coverage as I get older?
These questions are particularly important when comparing the new MediAsas with existing medical insurance products in the market.
RM55 COI is not the same as RM55 total premium
A fair comparison between medical plans should first compare like-with-like.
Recent comparisons have highlighted a medical plan in the market offering annual coverage of up to RM3 million “starting at RM55 a month”. However, consumers should understand exactly what that RM55 represents. For example, a recent product highlighted for comparison is a medical insurance rider rather than a standalone medical plan. The product materials describe the published figure as the Cost of Insurance (COI) for the medical rider. As the rider is attached to an underlying policy, the amount of premiums an individual actually pays is the total cost of the overall policy and not just the COI.
This distinction is important when comparing MediAsas with medical riders available in the market. MediAsas is designed as a standalone medical protection plan, unlike medical coverage solutions structured as riders attached to an underlying insurance policy. As such, consumers should take into account the overall product structure and total cost of protection when making comparisons. In simple terms, RM55 COI does not equal actual premium that one has to pay to obtain the medical coverage under investment-linked plans.
The real affordability test is at 50, not just at entry age
Medical insurance is intended to provide protection over many years. This makes its long-term affordability as important as its starting price.
A plan may appear inexpensive when a person is 20 or 30, but become significantly more expensive at 50, 60 or 70, particularly as healthcare needs and claims tend to increase.
This is why comparing only the lowest entry-age price can give consumers an incomplete picture.
When evaluating medical insurance, consumers should consider beyond the initial premium and consider the long-term affordability of the plan. As they grow older, particularly in their 50s, 60s and 70s, and as medical inflation continues to increase healthcare costs, the cost of maintaining adequate medical protection may rise significantly over time.
Published COI schedules for medical riders illustrate how insurance charges can rise with age. That does not make such products unsuitable; higher-limit plans can provide valuable additional protection for consumers who want broader coverage and can afford the associated cost.
But consumers should understand how costs may change over time rather than focusing solely on the attractive starting figure.
This is where MediAsas takes a different approach. Rather than focusing solely on coverage, it incorporates broader cost-containment features designed to address the underlying drivers of medical claims inflation and support the long-term sustainability of medical protection, a feature lacking in most medical and health insurance and takaful plans in the market.
MediAsas is designed to provide a foundational level of private medical protection focused on essential healthcare needs, affordability and long-term sustainability. It is not intended to be the highest-limit medical plan in the market. Instead, it provides standardised benefits across participating insurers and takaful operators. Consumer who requires higher annual limits or broader benefits can continue to choose other medical insurance and takaful products available in the market.
MediAsas is a yearly renewable standalone medical and health protection plan that is not linked to any investment products.
The objective is therefore not to replace every existing medical plan, but to provide a meaningful and more affordable option for consumers.
Final MediAsas pricing will be confirmed during launch. Once available, consumers should look beyond the initial price and consider whether the protection remains affordable as they get older. This provides a clearer picture of long-term affordability.
Is RM100,000 enough?
MediAsas has an annual limit of RM100,000, which increases to RM150,000 for individuals aged above 60. The limits were calibrated using medical claims data by Insurance Services Malaysia, which shows that 99% of claims paid by ITOs were below RM60,000, well within the RM100,000 limit. This suggests that the limit is sufficient to meet the healthcare needs of most policyholders. Additionally, MediAsas does not impose a lifetime limit.
This does not mean that higher limits have no value. More complex and costly treatments can exceed the annual limit. Consumers should therefore consider their own healthcare needs, financial circumstances and preferred level of protection when choosing a medical plan. For those who want a higher limit, MediAsas also provides the Fleksi option with an annual limit of RM300,000, subject to a higher deductible.
Medical Insurance does not work on a simple “price per ringgit of coverage” calculation.
A higher annual limit does not automatically provide proportionately greater value. While RM3 million may appear far superior to RM100,000 in comparison, medical insurance should not be evaluated solely based on the size of the annual limit.
Consumers should consider whether the limit is realistically aligned with potential healthcare expenses. Once the limit is sufficient to cover most medical claims, further increases in the annual limit are unlikely to provide significant value.
While higher limits offer additional protection, they may also encourage greater utilisation of healthcare services, contributing to higher claims costs over time. This, in turn, can lead to premium increases and product repricing. Ultimately, the value of a medical plan should not be measured solely by the size of its annual limit, but by whether it provides protection that is appropriate, affordable and sustainable over an individual’s life, especially at the older ages.
Affordable protection is protection consumers can keep
A medical plan only provides meaningful protection if consumers can continue to maintain it when they need it most. This is particularly important as healthcare costs and healthcare needs generally increase with age.
MediAsas therefore takes a different approach to affordability and sustainability. Its design incorporates features such as standardised benefits; defined coverage limits, tiered co-payments, preferred in network hospitals, broader risk pooling and measures to improve healthcare cost management, including the progressive adoption of Diagnosis-Related Group (DRG) payments.
These features are intended to help manage unnecessary healthcare costs and support more sustainable premiums over time. The final MediAsas premiums will be confirmed closer to its launch in 2027 and will be reviewed periodically based on factors including claims experience, medical inflation and changes to covered benefits.
Ultimately, the key question is not, "How many millions am I covered for, that I may never use?" but rather, "What level of protection can I afford and maintain as my healthcare needs change overtime?". That is a more meaningful measure of medical protection.
