Malaysia To Create New Insurance Scheme for Citizens Working in Singapore

Malaysia is developing a new insurance scheme to provide social security protection for citizens working in Singapore.

Human Resources Minister Datuk Seri R. Ramanan stated that the initiative aims to cover approximately 400,000 Malaysians who commute daily from Johor.

The scheme specifically addresses the lack of coverage during the period when workers travel between their workplace and home.

“Workers should not be victimised simply because they are working in Singapore,” Ramanan noted.

He emphasised that Malaysian citizens deserve consistent standards of safety and care, regardless of where they work. This project has been a primary focus for the minister since his appointment in December 2025.

The Ministry of Human Resources is currently reviewing 26 laws to align national legislation with International Labour Organisation standards.

A significant milestone in this process was the amendment of the Employment Insurance System (SIP) Act in late 2025.

While the law has passed, a two-year moratorium is currently in place to allow for extensive stakeholder engagement.

Minister Ramanan highlighted that the SIP requires only a small contribution from employers, with rates determined by a council of stakeholders.

He likened the small daily cost to life insurance, noting that it protects families from financial hardship following unfortunate accidents.

“When they don’t contribute and have met with an unfortunate accident, families suddenly end up in a situation where they have no money,” he explained.

Recent data shows the existing SIP’s impact. As of 30 November 2025, 57,094 workers, representing 85.3% of job-loss cases, received benefits totalling RM437.19 million over the last five years.

The new scheme seeks to find a balance that supports employees without placing undue pressure on employers.

Featured image: Edited by Fintech News Malaysia based on images by rawintanpin, idrixel and idrixel via Freepik.