LIAM Calls For Higher Tax Relief For Medical Insurance - Bernama

KUALA LUMPUR, Sept 4 (Bernama) - The Life Insurance Association of Malaysia (LIAM) has called on the government to consider increasing the current RM3,000 tax relief for child education and medical insurance to RM6,000.

According to the association, the current RM3,000 tax relief is not sufficient for a family to plan for their children's education needs and healthcare requirements.

"With the rising costs of education and medical treatment, Malaysians should be encouraged to take up financial planning," it said in a statement Tuesday.

LIAM said the combined tax relief of RM6,000 for life insurance/takaful premiums and contribution to the Employees Provident Fund (EPF) was inadequate.

The association proposed that a separate tax relief be given solely for life insurance premiums.

LIAM also proposed that private pension schemes be established by the government to enable the working population to plan for their retirement.

"The aim is to assist Malaysians to achieve financial independence after retirement. Relying on EPF savings alone is insufficient as retirees would have to ensure their life-time savings could last another 20 to 30 years," the association said.

"There is also a large group of self-employed (about 25 percent of the working population ) who may not have any retirement savings," it added.

Another proposal by LIAM called on the government to review the tax structure of life insurance business by removing the eight percent tax paid by policyholders.

"This is to make life insurance a competitive savings/protection plan compared to unit trusts and bank deposits which are generally tax-free," the association said.

-- BERNAMA