Just over one in four Malaysian households have flood insurance, according to the General Insurance Association of Malaysia (PIAM).
Data released by the association on Friday showed that an average of 27.6% of households had flood insurance in 2025, while only 13% had flood coverage for their vehicles. Total losses from floods reached RM636.9 million in 2025, according to the statistics department.
PIAM chief executive Chua Kim Soon said the low take-up may be due to psychological factors, with many Malaysians relying on personal experience to decide whether to buy coverage. “People think it will never happen to them. They also think insurance is a waste of money. However, when it strikes, it strikes big,” he told a press conference.
The association said houseowner and householder policies usually include flood coverage, but motor insurance generally excludes natural disasters, which are normally covered under an optional special perils add-on.
Asked why insurers do not automatically cover all natural disasters, Chua said the industry wanted to give customers a choice rather than force them to take up additional coverage.