KUALA LUMPUR, March 20 — More than 153,000 Employees Provident Fund (EPF) members have withdrawn a total of RM51 million from their retirement savings to purchase life and critical illness insurance under the i-Lindung programme.
The Ministry of Finance (MOF) said the withdrawals were made from the Akaun Sejahtera (formerly Account 2) under the Member Protection Plan (PPA), which allows contributors to use their savings for insurance and takaful coverage.
“Since its introduction in July 2022 until December 2024, a total of 153,618 EPF members have used this facility to purchase protection products,” the ministry said in a written Dewan Rakyat reply last February 20 to Wangsa Maju MP Zahir Hassan.
MOF said the initiative was part of efforts to expand health care access as medical costs continue to rise, driven by advancements in medical technology and the increasing prevalence of non-communicable diseases (NCDs) in Malaysia.
To expand coverage, EPF launched i-Lindung Phase 2 in February 2024, allowing contributors to use their Akaun Sejahtera savings to purchase life and critical illness insurance for their immediate family members.
EPF, Malaysia’s largest retirement fund, introduced i-Lindung as a self-service platform under i-Akaun, enabling members to purchase approved insurance and takaful products from registered insurers and takaful operators. The coverage is available for both short-term (1 year) and long-term (up to 75 years) protection.
Concerns over rising medical insurance premiums and private hospital fees gained widespread attention toward the end of 2024.
While the issue was formally raised then, many policyholders—including cancer patients, retirees, and teachers with group insurance—had already been experiencing steep annual premium hikes for years. It remains unclear whether recent concerns have influenced EPF withdrawals in more recent months.
The government recently announced that Bank Negara Malaysia, EPF, and the Ministry of Health (MOH) are working to develop basic medical and health insurance (MHIT) and takaful products, focusing on standardised parameters, design, and pricing.
Deputy Finance Minister Lim Hui Ying said this would make it easier for users to understand coverage benefits, compare options, and make informed financial decisions.
For these products to be sustainable, broad and diverse participation is crucial, especially a balanced mix of younger and older policyholders to stabilise premiums over time.
Lim said the government aims to leverage i-Lindung to build an early pool of EPF members as policyholders, strengthening the foundation for the new MHIT products.
