Global FinTech Guide
Country Name
InsurTech is composed of the words “insurance” and “technology”. It is used as a collective term for the application of modern technologies in the domain of insurance services.

Digital and mobile brokers: FinTechs belonging to this category mostly act as digital insurance brokers and provide users with an overview of their insurance contracts with their respective conditions. Some FinTechs offer very short-term insurance contracts to cover specific cases which can be concluded often spontaneously via mobile devices. Oftentimes additional consulting services are offered.

Internet of things: FinTechs belonging to this category collect data by measuring for example the driving style of the customers or through wearables the customers wear to consult on, offer and/or manage the customer’s insurances.


Attitude of the country towards InsurTech-services

According to the National Internet of Things (“IoT”) Strategic Roadmap published by MIMOS Berhad, Malaysia is at an excellent position to seize the economic opportunities generated by the IoT because of the strength of the local electrical and electronics (E&E) industry.

Having said the above, according to a study by the Asian Institute of Chartered Bankers and PricewaterhouseCoopers Malaysia in 2016, insurers are of the view that there is a low level of consumer readiness in opting for InsurTech products and services as opposed to conventional insurance products and services. 

However, in recent years, BNM has implemented plans to create a regulatory framework for digital insurers as part of its wider initiative to encourage innovation across Malaysia’s financial sector to better serve the needs of various segments of the population by enhancing the population’s financial resilience.

Legal affairs

Obligations and requirements to provide InsurTech-services

Digital and mobile brokers: In principle, one must obtain approval from BNM prior to offering insurance broking services as an independent contractor under the FSA and must maintain a minimum of RM1 million in capital funds at all times. However, there will be no such need if the services are provided by the FinTech in its capacity as a corporate agent of a licensed insurer or by hosting its services through the digital channels of the licensed insurer. Further, FinTechs approved by BNM under the Regulatory Sandbox are exempt from obtaining licences under the FSA.

Internet of Things: Although there are no specific licensing or regulation with regard to usage or provision of IoT or IoT related services, concerns with regard to data protection laws may arise in the case where data containing personal data of individuals are collected and utilised. Care should be taken to ensure that in the processing of any information which is capable of identifying an individual, regard must be made to ensure compliance with personal data protection laws in Malaysia. 

Additional comments regarding the legal situation for InsurTech-services or what InsurTech’s must be aware of in this business area

BNM has on 4 January 2022 issued a Discussion Paper on Licensing Framework for Digital Insurers and Takaful Operators. The Discussion Paper outlines the proposed framework for licensing new digital insurers and takaful operators (“DITOs”) to encourage digital innovation in the insurance and takaful sector. BNM is considering fixing the minimum paid up capital requirement at RM 40 million for licensed DITOs at the point of entry.

A subsequent policy document addressing the prudential and business conduct requirements is anticipated to be published in late 2022.

Economic conditions

Market size for InsurTech-services and biggest companies in this business area

According to a statistical report by Insurance Services Malaysia Bhd, sales (gross written premiums) via the online distribution channel grew 32.6% year on year in 1H2019. The biggest companies in Malaysia include GoBear Ltd, GetCover Sdn Bhd, MoneyMatch Sdn Bhd, and WorldRemit Ltd.

Additional comments regarding the economic situation for InsurTech-services or what InsurTech’s must be aware of in this business area

Three (3) FinTechs, namely GoBear Ltd, Get Cover Sdn Bhd and Jirnexu Sdn Bhd which are not insurance brokers, are understood to operate within this segment and have been granted the relevant approvals by BNM to operate following exemptions granted via the Regulatory Sandbox.



© 2022, Lee Hishammuddin Allen & Gledhill. All rights reserved by Lee Hishammuddin Allen & Gledhill as author and the owner of the copyright in this chapter. Lee Hishammuddin Allen & Gledhill has granted to Multilaw non-exclusive worldwide license to use and include this chapter in this guide and to sublicense Lexis Nexis, a division of RELX Inc. and its affiliates certain rights to use and distribute this guide.

The information in this guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.


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