Malaysia's life insurance industry is set to see high single-digit growth in terms of new business premiums in 2017, said the Life Insurance Association of Malaysia (LIAM).
LIAM President Toi See Jong said this positive performance would be mainly supported by the better economic growth of the country, reported Bernama.
“Malaysia’s gross domestic product is forecast to hit between 4.3% and 4.9% this year. So, the life insurance industry will grow in line with the country’s economic growth,” he told reporters recently.
Last year, new business premiums in the industry rose by 6.9% year-on-year to MYR9.75 million (US$2.28 million). Mr Toi said that the implementation of online platforms by insurers, which started in 1 January this year would also help improve the industry’s growth.
He was referring to the regulations under the Life Insurance and Family Takaful Framework introduced by Bank Negara Malaysia, which required insurers to offer pure protection products through direct channels without commissions from 2017. This is to be followed by critical illness and medical and health insurance/takaful products by 1 January, 2018.
Mr Toi noted, however that premiums contributed by the online platform have been still small, since the platform is still at the initial stage of implementation.
“As insurance policies are quite complex, we believe agents still play a vital role in explaining the insurance products,” he added.
He emphasised that various educational and promotional programmes are still needed to further increase the awareness level among the people and reduce the insurance protection gap.
LIAM has targeted to reach the life insurance penetration rate of 75% in 2020, and it currently stands at around 55%, reported Bernama.