Malaysian insurers cannot void medical claim base on non-disclosure of pre-existing conditions?

In Malaysia, insurers can void a medical claim or a policy based on the non-disclosure of pre-existing conditions. The legal framework for these actions is primarily established under the Financial Services Act (FSA) 2013 and the Insurance Act 1996. 

Key Legal Provisions

• Duty of Disclosure: Before entering into an insurance contract, applicants must disclose all material facts. A material fact is anything that would influence an insurer's decision to accept the risk or determine the premium rate.

• Remedies for Non-Disclosure: Under Schedule 9 of the FSA 2013, if an applicant fails to take "reasonable care" not to make a misrepresentation, the insurer may:

  • Void the contract entirely (treat it as if it never existed).

  • Refuse or reduce a claim.

  • Terminate the contract or change its terms. 

Important Nuances as of 2025

• Pre-Existing Condition Exclusions: Most private medical plans in Malaysia explicitly exclude pre-existing conditions (illnesses for which symptoms or treatment occurred before the policy began).

• Unreasonable Denials: As of December 2025, Bank Negara Malaysia (BNM) has emphasized that insurers cannot unreasonably delay or deny claims or apply exclusions that were not clearly stated in policy documents.

• Medical Check-Ups: BNM does not mandate medical check-ups before policy purchase; however, this places the responsibility on the consumer to be honest and thorough during application.

• Innocent Non-Disclosure: If you genuinely did not know about a condition (e.g., it was undiagnosed and symptom-free), it may not be considered a breach of duty. However, "forgetfulness" or "carelessness" in filling out forms is typically not a valid defense. 

What to Do if a Claim is Rejected

If a claim is rejected due to alleged non-disclosure of a pre-existing condition, you can:

1. Appeal to the Insurer: Request a detailed justification for the rejection.

2. Contact the Ombudsman for Financial Services (OFS): If the internal appeal fails, you can file a dispute with the OFS, which provides independent dispute resolution for financial consumers.

3. Lodge a Complaint with Bank Negara Malaysia: Reports of unfair treatment can be made via BNM Telelink. 

AI responses may include mistakes. For legal advice, consult a professional.