2011 FIXED DEPOSIT RM250,000 INSURED
By m_azlanshah • May 13th, 2010• Category: ! Product News
PM: Fixed deposits to be insured up to RM250,000 by 2011
KUALA LUMPUR: Prime Minister Datuk Seri Najib Tun Razak announced Tuesday increased financial consumer protection whereby deposit insurance limit will be raised to RM250,000 effective 2011 from the current RM60,000.
The Finance Ministry, in a statement here Tuesday, said the prime minister intended to advance a package of legislative initiatives aimed at enhancing financial consumer protection for Malaysians.
The ministry said Malaysia Deposit Insurance Corp (PIDM) would bring forward legislation to enable the government to increase the deposit insurance limit.
“The plan is for this package to be tabled in Parliament for debate and enactment before year-end,” it said.
The ministry said PIDM would also develop legislation to introduce an explicit insurance compensation scheme (ICS) for insurance and takaful policyholders.
“It is to ensure that policyholders of insurance and takaful products will also enjoy a similar level of consumer protection provided by PIDM for depositors in the commercial banks and Islamic banks.
“This demonstrates the government’s continued commitment to enhance financial consumer protection for Malaysian and to promote continued public confidence in the financial system,” it said.
It said since the temporary government deposit guarantee would lapse as scheduled at the end of this year, the enhanced protection package would continue to provide increased protection to depositors.
“With this new limit, 99% of depositors will be protected in full,” it said.
The ministry said the establishment of an explicit ICS to be administered by PIDM would level the playing field between the banking industry and the insurance industry.
“It will remove the competitive distortions between the two, as policyholders and depositors in both sectors will now be protected.
“The proposed ICS will contribute to enhancing financial consumer confidence which will in turn promote consumer demand for insurance and takaful products,” it said.
It said PIDM would conduct a consultation process with stakeholders on the key design features of the proposed insurance compensation scheme before bringing forward its recommendations to the government.
- Bernama
