Deposit insurance is a system established by the government to protect depositors against the loss of their insured deposits placed with member institutions in the event the member institution fails. All types of depositors, whether businesses or individuals, are protected. The maximum limit of coverage is RM 250000 per depositor per member institution. This includes both the principal amount of a deposit and the interest/return.
All commercial banks licensed under the Banking and Financial Institutions Act 1989 (BAFIA) and all Islamic banks licensed under the Islamic Banking Act 1983 (IBA), including foreign banks operating in Malaysia, are member institutions of PIDM. Membership in PIDM is compulsory as provided under the Akta PIDM. Member institutions are required to prominently display this membership sign at all entrances to their branches:
Takaful and Insurance Benefits Protection System (TIPS) is a system established by the government to protect owners of takaful certificates and insurance policies from the loss of their eligible takaful or insurance benefits in the event that an insurer member fails and is unable to honour the takaful or insurance benefits. To be eligible for protection under TIPS, the takaful certificate or insurance policy must be issued in Malaysia by an insurer member and be denominated in Ringgit Malaysia.
All takaful operators licensed under the Takaful Act 1984 to conduct family solidatary and/or general takaful business in Malaysia, as well as insurance companies licensed under the Insurance Act 1996 to conduct life and /or general insurance business in Malaysia are member institutions or insurer members of PIDM. Membership in PIDM is compulsory as provided under Akta PIDM. Insurer members are required to prominently display the membership sign or decal as above at all the entrances to their offices.
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