In Malaysia

The in­surance in­dus­try has evolved from its early days from tra­di­tional meth­ods of dis­tribut­ing its prod­ucts and ser­vices to the gen­eral pub­lic. An­nette Lim ex­plains the evo­lu­tion, de­vel­op­ments and chal­lenges that are af­fect­ing in­surance distri­bu­tion.

Insurance - - DISTRIBUTION CHANNELS -

mail­ing, counter sales (mainly mo­tor) or through credit cards (mainly per­son­alised lines), ban­cas­sur­ance, etc. Since no in­ter­me­di­ary is in­volved, very com­pet­i­tive pre­mi­ums (nett) can be of­fered to cus­tomers.

Agents

As there is no re­quire­ment on paid-up cap­i­tal, this is a type of busi­ness where agents can start trans­act­ing busi­ness as soon as they have ob­tained the Pre­Con­tract Ex­am­i­na­tion For In­surance Agents (PCEIA) and pos­sess the min­i­mum SPM/MCE (or equiv­a­lent) qual­i­fi­ca­tion. In view of their low over­heads (some may op­er­ate at home), they are able to pro­vide ser­vice to cus­tomers hav­ing small and medium-sized risks at small towns. As agents are tech­ni­cally not as equipped as bro­kers, they nor­mally go for small and medium sized busi­ness of­fer­ing ba­sic cov­ers. Agents are re­quired to pass the PCEIA from the Malaysian In­surance In­sti­tute (MII) un­less they hold pro­fes­sional in­surance qual­i­fi­ca­tions such as As­so­ci­ate­ship of the Char­tered In­surance In­sti­tute (ACII), As­so­ci­ate­ship of the Malaysian In­surance In­sti­tute (AMII), etc.

In­surance Bro­kers

As in­surance bro­kers are ad­vis­ers and con­sul­tants, and are li­able to be sued for neg­li­gent or wrong­ful ad­vice, they are gen­er­ally equipped with staff hav­ing pro­fes­sional qual­i­fi­ca­tions such as ACII, AMII, some even with Fel­low­ship qual­i­fi­ca­tions.

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