Just over 1 in 4 households insured against floods, says association

The General Insurance Association of Malaysia (PIAM) reports that nearly one in four Malaysian households have flood insurance, with an average of 27.6% of households insured as of 2025. However, the figure drops to 13% for motor insurance coverage. Despite total flood losses amounting to RM636.9 million in 2025, many Malaysians seem hesitant to purchase flood coverage.

PIAM CEO Chua Kim Soon attributes this low take-up rate to psychological factors, as Malaysians often rely on personal experience to decide whether to buy insurance. He noted that people believe flood incidents will never affect them and view insurance as unnecessary. However, when floods occur, they can be devastating. PIAM highlighted that standard homeowner and householder policies typically include flood coverage, while motor insurance usually excludes natural disasters and requires a separate "special perils" add-on.

Chua explained that insurance companies do not automatically include coverage for all natural disasters to give customers the choice to decide what they need or not. The industry aims to avoid customers feeling forced to pay extra for coverage they may not require. Chua emphasized that customers should fully understand what they are purchasing and paying for.