In January 2026, Bank Negara Malaysia (BNM), the Ministry of Finance and the Ministry of Health jointly published the White Paper on the Base Medical and Health Insurance/Takaful plan (“Base MHIT”), known as MediAsas. This is part of RESET,1 Malaysia’s national healthcare reform programme launched in 2025 after public outcry over steep 2024 MHIT premium hikes.
From January 2027, every licensed life insurer and family takaful operator writing medical and health business in Malaysia will need to offer the standard Base MHIT plan, MediAsas Teras, alongside existing MHIT plans; the standard-plus Base MHIT plan, MediAsas Fleksi, is optional. A Klang Valley pilot programme began running from the end of July 2026 and will conclude in October 2026, with six participating life insurers and family takaful operators, ahead of nationwide implementation.
In Malaysia, MHIT products are offered by both life insurers/family takaful players and general insurers/general takaful operators. This e-alert focuses on the life insurance and family takaful segment in Malaysia.
Although existing MHIT products are not being replaced, new MHIT offerings will be shaped by the standards set for the Base MHIT plan. For many insurers, this is not an incremental product change; it resets the economics of the largest protection line in the market.
This e-alert discusses three critical questions:
- Growth: How large is the addressable medical opportunity after allowing for structural constraints?
- Profitability: How did product-design and pricing levers impact Singapore’s Integrated Shield Plans (IPs) claims ratio?
- Product strategy: What are the implications following the introduction of Base MHIT plans on product development for all MHIT plans (Base MHIT and other MHIT plans) and overall company-level product strategy over the next 12 to 18 months?
1 RESET: Revamp MHIT, Enhance price transparency, Strengthen digital health system, Expand cost-effective options, Transform provider payment mechanisms.