Why Malaysia should have national long-term care insurance and how it can be funded

KUALA LUMPUR, Nov 2 — Malaysia should consider implementing a national long-term care insurance to cover the expenses incurred by older individuals who require care and support beyond hospital treatment. The question remains, who would bear the financial burden? The government through taxation, every Malaysian through monthly contributions, or a combination of both?

Edmund Cheong Peck Huang, Deputy CEO of Social Security Organisation (Socso) and Perkeso, explained that Socso already offers long-term care for Malaysian workers as a monthly “invalidity pension” provided the individual becomes incapacitated before the age of 60. However, Cheong pointed out a moral hazard in which Malaysians attempt to claim the Socso pension before reaching 60, despite not being disabled.

Cheong suggested making long-term care insurance mandatory for all Malaysians and highlighted that the monthly premium would be more affordable if it were a mandatory scheme. Nor Azman Zainal, Group CEO of Syarikat Takaful Malaysia Keluarga Berhad, expressed that Malaysians are generally unwilling to pay for retirement-related insurance products, and a voluntary scheme would not be successful in Malaysia.