PIAM’S Per­spec­tive on What’s on the Hori­zon for 2013

Chua Seck Guan, Chair­man of Per­sat­uan In­surans Am Malaysia (PIAM) re­views some of the ma­jor in­dus­try ac­tiv­i­ties and chal­lenges that had oc­curred dur­ing 2012 while also shar­ing with us their up­com­ing ini­tia­tives and giv­ing us some in­sights and ex­pec­ta­tions

Insurance - - FOCUS OUTLOOK 2013 -

Q: How sat­u­rated is the gen­eral in­surance mar­ket in Malaysia? What should be done for fur­ther growth in this area? Amidst the global eco­nomic un­cer­tainty and huge cat­a­strophic losses ex­pe­ri­enced in the re­gion in 2011, the Malaysian gen­eral in­surance in­dus­try reg­is­tered pos­i­tive growth with gross writ­ten pre­mium in­creas­ing by 7.85% to reach RM14.029 bil­lion, com­pared with an in­crease of 8.56% (RM13.009 bil­lion) in 2010. Net pre­mi­ums also grew at a rate of 8.20% to reach RM9.718 bil­lion. In the same year, the in­dus­try recorded an un­der­writ­ing mar­gin of 9.8% amount­ing to RM1.266 bil­lion in 2011 com­pared to 10.2% amount­ing to RM1.053 bil­lion in 2010. With pru­dent un­der­writ­ing and op­er­a­tional pro­ce­dures in place, the com­bined man­age­ment ex­penses and com­mis­sions ra­tio of in­surance com­pa­nies was main­tained at 29.5% in 2011, as for the year be­fore. For the pe­riod Jan­uary to June 2012, the gross writ­ten pre­mi­ums grew by 8.0% to RM7.881 bil­lion com­pared to RM7.297 bil­lion for the same pe­riod in 2011. Net pre­mi­ums grew to RM5.279 bil­lion com­pared to RM4.965 bil­lion in 2011. With in­creas­ingly dis­cern­ing con­sumers and the aware­ness of the ben­e­fits de­rived from in­surance, the op­por­tu­ni­ties are read­ily avail­able for in­surance com­pa­nies to grow their busi­nesses, cou­pled with a proper in­fra­struc­ture and foun­da­tion in place for in­sur­ers that are ready to take on this chal­lenge.

Q: The domestic fi­nan­cial in­sti­tu­tions in Malaysia are un­der­go­ing re­struc­tur­ing, con­sol­i­da­tion and ra­tio­nal­i­sa­tion due to the ef­fect of glob­al­i­sa­tion. Hav­ing greater scale, there is in­creased in­vest­ment in tech­nol­ogy and tal­ent. How much of a prob­lem is the short­age of qual­i­fied work­ers for the gen­eral in­surance sec­tor? What are the ini­tia­tives from PIAM in ad­dress­ing this cru­cial need? The Fi­nan­cial Sec­tor Blue­print which was of­fi­cially launched by Bank Ne­gara Malaysia on 21 De­cem­ber 2011, iden­ti­fied the en­hance­ment of tal­ent devel­op­ment as an area to be ad­dressed by in­sur­ers and taka­ful op­er­a­tors. The in­surance in­dus­try is multi-dis­ci­plinary and the ca­reer op­por­tu­ni­ties avail­able in the in­dus­try are numer­ous. In terms of be­ing the em­ployer of choice, the in­surance in­dus­try has al­ways been at a dis­ad­van­tage com­pared to the other fi­nan­cial ser­vices sec­tors. The As­so­ci­a­tion had un­der­taken sev­eral ini­tia­tives to cre­ate aware­ness of the ca­reer op­por­tu­ni­ties avail­able in the in­surance in­dus­try by par­tic­i­pat­ing in ca­reer fairs or­gan­ised by in­sti­tu­tions of higher learn­ing and other fi­nan­cial bod­ies. In ad­di­tion, sev­eral ed­u­ca­tion and train­ing ini­tia­tives have been in­tro­duced for mem­bers to en­hance their ex­po­sure to new prac­tices and ap­pli­ca­tions in the in­surance mar­kets. The As­so­ci­a­tion has also formed a Young Man­agers’ Think Tank (YMTT) with the main

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