MALAYSIA is set to introduce a basic medical and health insurance or takaful (MHIT) plan priced as low as RM80 to RM120 a month, as part of a broader effort to tackle medical inflation and expand healthcare coverage in a country where only 22 per cent of the population currently has medical insurance.
The proposed plan is primarily targeted at individuals who are uninsured, as well as those seeking a more affordable alternative to existing MHIT policies amid steep premium increases, particularly at older ages.
The maximum entry age for the scheme is 70.
CIMB Securities analyst Chun Sung Oong said the Basic MHIT Plan White Paper announced by the government reflects collaboration between the Ministry of Finance, the Ministry of Health, Bank Negara Malaysia (BNM) and industry stakeholders to strengthen the national healthcare system while addressing rising medical costs.
“The MHIT plan is targeted at individuals without medical insurance or takaful coverage, as well as those seeking more affordable alternatives following premium increases, with voluntary participation including through the use of Employees Provident Fund (EPF) Account 2,” he said in a research note.
The government has described the initiative as a “drastic” measure to ease cost-of-living pressures.
Despite its “rahmah”, or compassionate, pricing, the basic plan will provide an annual coverage limit of RM100,000.
According to the Basic MHIT Plan White Paper, this limit is considered sufficient to cover 99 per cent of treatment episodes for common medical conditions based on current medical claims trends.
Coverage will focus on routine treatments at private hospitals, while complex and high-cost care will continue to be managed by the public healthcare system.
The plan is expected to be offered initially to individuals aged between 31 and 35 at the RM80 to RM120 monthly premium range. It is scheduled to enter the market in early 2027, following a pilot phase in the second half of 2026.
Designed to provide meaningful financial protection for essential healthcare needs, the scheme also aims to channel private healthcare spending more efficiently.
The initiative forms part of the RESET strategy jointly driven by the Ministry of Finance, the Ministry of Health and BNM.
Authorities are also studying the option of allowing EPF contributors to pay premiums using savings from their Akaun Sejahtera.
Sung Oong said the basic MHIT plan represents an important step towards widening access to healthcare services, with the potential to expand the risk pool across all participating insurance and takaful operators.
“A broader risk pool can help reduce claims volatility and support long-term premium stability,” he said, while cautioning that implementation remains critical given the absence of direct government financial support for MHIT subscriptions. - January 24, 2026
