Malaysia’s expansion of worker social protection is beginning to produce something policymakers had already warned about: a sharp increase in claims.
Claims under the Social Security Organisation’s Lindung 24 Jam programme more than tripled in July, rising from 616 cases in June to 2,135, according to figures reported by The Edge Malaysia. More than RM3.45 million in benefits was paid during July alone.
For Human Resources Minister Datuk Seri R. Ramanan, the surge is not entirely unexpected.
Two months earlier, Ramanan warned that PERKESO’s annual claims across its expanding protection programmes could eventually rise by as much as 200% from the previous average of roughly 170,000 cases a year. The projection was tied to programmes including Lindung 24 Jam, the Gig Workers Act 2025 and a planned Traveller Scheme.
The numbers now arriving from Lindung 24 Jam offer an early glimpse of what broader coverage could mean financially.
More workers are protected.
More workers can also make claims.
Claims are already moving higher
Lindung 24 Jam took effect on June 1 and expanded PERKESO protection beyond accidents connected directly to employment.
The programme covers qualifying non-work-related accidents occurring outside working hours, effectively extending social protection into workers’ personal lives. PERKESO describes the programme as round-the-clock protection that can include medical treatment and other benefits for eligible accidents.
By the end of July, PERKESO had received 2,751 Lindung 24 Jam claims, averaging about 45 a day. Total benefit payments had reached RM4.69 million, excluding more than RM2 million in longer-term benefits to eligible family members.
More than RM800,000 of July payments went toward temporary disability benefits designed to replace income while contributors were unable to work.
Another RM2.5 million-plus went toward rehabilitation equipment and implants.
Those figures highlight the financial argument behind social insurance. A serious accident does not only create a hospital bill. It can temporarily remove a worker’s income while leaving a family’s normal expenses untouched.
Ramanan made that broader point when discussing the potential rise in claims in June.
“This surge will require more efficient and integrated rehabilitation service capacity,” he said, according to Bernama.
The 200% forecast needs context
The headline number is dramatic, but it should not be misunderstood.
Ramanan did not say PERKESO had already experienced a 200% increase in total annual claims. He said claims could eventually increase by as much as 200% as Malaysia brings more workers and more types of accidents within its protection system.
There is also an important policy change.
Lindung 24 Jam initially required Malaysian employees to contribute 0.75% of their wages during its first phase. Following public criticism of the additional payroll deduction, the Cabinet reversed course in July and made participation voluntary for local employees. It remains mandatory for foreign workers.
That change could ultimately affect how closely actual claims track Ramanan’s earlier projections.
Still, the first two months show that the underlying demand is real.
PERKESO chief executive Datuk Seri Mohammed Azman Aziz Mohammed told The Edge Malaysia that the programme should not be viewed simply as another insurance product.
“We are a social protection agency, the safety net for workers. We are the last net. If you fall below this net, you will go into poverty,” Mohammed Azman said.
That distinction matters.
Private insurance is generally built around an individual policyholder and the coverage purchased. PERKESO’s role is broader, providing a base level of income and social protection intended to prevent an accident from becoming a financial crisis.
Malaysia is widening its social safety net
Lindung 24 Jam is part of a wider effort to expand social protection beyond the traditional employer-employee model.
Freelancers and gig workers are becoming a larger part of Malaysia’s labour market, creating a challenge for systems originally designed around conventional full-time employment.
Sunway University economics professor Dr Yeah Kim Leng told The Star that making programmes offered through PERKESO and the Employees Provident Fund more inclusive is “a step in the right direction.”
“This is especially since freelancers have become a large and integral part of the workforce,” Yeah said.
He argued that access to retirement savings and financial protection is important if freelance and gig employment is going to provide sustainable long-term livelihoods.
Financial planner Linnet Lee has made a similar argument about extending social protection to groups facing greater health and financial risks.
“Household work carries physical risks regardless of age,” Lee told The Star, arguing that wider coverage can help families manage medical costs and financial risk.
More protection comes with a price
PERKESO’s challenge now is not simply expanding eligibility.
It has to prove the expanded system can process claims quickly, fund benefits sustainably and convince workers that contributing is worthwhile.
There are positive early signs. PERKESO said more than 90% of Lindung 24 Jam claims submitted in July were approved within five days.
But the financial equation becomes more important as coverage grows.
The programme’s contribution rate begins at 0.75% for participating Malaysian employees, with the original structure providing for increases to 1% and later 1.25%. Contributions are borne by workers rather than employers.
That helps protect employer labour costs, but it also explains some of the public resistance. Workers see the deduction directly in their paychecks, while the value of insurance may remain invisible until an accident occurs.
Malaysia is effectively confronting the central dilemma of every social protection system.
A broader safety net costs money.
But having no safety net can cost considerably more when a worker suddenly cannot earn.
The early claims data suggest Malaysians are already testing exactly where that balance lies.