Arak is a Balinese moonshine traditionally distilled in the island's east and used in religious ceremonies.
Balinese women offer prayers during the Hindu festival of Galungan. Photo / AP
The "tourist invasion of Bali", however, has opened up the market for backyard distillers, said the insurer.
His comments follow the Seven Network documentary What Really Happens In Bali, which aired last night and highlighted the dangers of drinking locally made spirits.
Mr Sylvester said people can be attracted to arak because it can give them a cheap night out with plenty of bang for their buck.
"Producing the spirit is cheap, especially when backyard cowboys with no experience are doing it rather than practised, seasoned old Balinese men," Mr Sylvester said in a statement today.
"And a bar owner concerned only about profit will lace the drinks with the cheaper stuff," he added.
But if arak is poorly made it can be laced with methanol, which can send people blind and lead to death.
The signs of methanol poisoning are difficulty breathing, blurred vision, agitation, dizziness and stomach pain.
- AAP
