PETALING JAYA: Malaysia’s insurance industry is entering a transformative phase as electric vehicles, autonomous technologies and evolving mobility patterns reshape risk and coverage models, according to Allianz Partners managing director for Asia-Pacific, Middle East and Africa, Vinay Surana.
Speaking exclusively to SunBiz, he highlighted three major trends redefining the local insurance landscape – the growing sophistication of motor insurance pricing, the rapid adoption of EVs and new mobility models, and escalating climate-related risks.
“Motor insurance remains the backbone of the industry, but pricing is moving beyond traditional metrics such as engine size or no‑claim discounts. Insurers now analyse granular data including postcode-level flood and theft exposure, driver profiles, and vehicle safety features,” Vinay said.
EVs, he noted, are fundamentally altering the market. Malaysia’s first half of 2024 saw EV sales surge 150% compared with the same period in 2023, and EVs now account for nearly 8% of private car policies.
The shift brings higher and more complex insurance costs, prompting tailored products that protect high-value components like traction batteries, home wallbox chargers, and even mobile charging assistance for depleted batteries.
“While EVs may reduce accident frequency due to advanced technology, claims costs are higher because repairs involve expensive and complex components,” Vinay explained.
“Insurers are leveraging digital tools and piloting AI solutions to enhance claims efficiency while monitoring the broader EV ecosystem for underwriting resilience.”
Autonomous vehicle technology introduces another layer of complexity. As responsibility moves from drivers to machines and potentially to multiple parties including manufacturers, software developers, and remote supervisors determining fault after accidents becomes more challenging.
Vinay stressed the need to keep motor insurers as the primary point of compensation to ensure victims are protected.
“Traditional liability frameworks are under strain in mixed traffic conditions,” he said.
“Insurance products must evolve to incorporate risks such as software failures and cyberattacks, while pricing and coverage adapt to the unique nature of autonomous claims.”
The rise of multimodal mobility, from ride-hailing and micro-mobility to public transport, also demands a shift in underwriting philosophy.
Vinay said insurers must move beyond vehicle-centric approaches, adopting flexible, usage-based policies that reflect real-world mobility patterns. Allianz Partners is exploring data-driven and embedded insurance solutions, designed to integrate seamlessly into mobility ecosystems.
Despite progress, gaps remain in Malaysia’s regulatory framework, particularly around liability, data governance, and the interplay between human drivers and vehicle software providers. “Without clarity, insurers face uncertainty in underwriting and claims outcomes,”
Vinay said. “Global experience in mature EV and ADAS (Advanced Driving Assistance Systems) markets allows us to support the local ecosystem with data insights, strategic partnerships, and modular coverage solutions.”
From a business perspective, insurers are balancing the trade-off between lower accident frequency and higher claim costs in the EV sector.
“It’s a fundamental shift,” Vinay noted. “Dynamic, usage-based underwriting and partnerships with mobility providers help us assess risk in real time, while continuously refining pricing models as more claims data becomes available.”
Allianz Partners is also focused on supporting Malaysian consumers and businesses through these transitions.
“We believe building safer, more inclusive mobility is a shared responsibility,” Vinay said. The company works with original equipment manufacturers and mobility operators to deliver simple, embedded insurance solutions, ensuring protection keeps pace with evolving technology and regulatory changes.
Looking ahead, Vinay sees opportunities for insurers to innovate over the next three to five years. Products will need to address emerging risks like software failures, data issues, and cyberattacks, while victim protection remains central. Insurers are also expected to offer comprehensive trip coverage under Mobility-as-a-Service models, providing insurance across multiple transport modes.
“The future lies in insurers becoming proactive mobility partners collaborating with OEMs, technology providers, and regulators to shape a safer, more sustainable transport ecosystem in Malaysia,” Vinay said.
The Sun Malaysia
