Yoon Yew Khuen

Di­rec­tor of In­sur­ance De­vel­op­ment, BNM

Insurance - - FORSIDE -

QCon­grat­u­la­tions on your new role. Please share what does it en­tail.

As the Di­rec­tor of In­sur­ance De­vel­op­ment De­part­ment, I will be lead­ing a team that is tasked with re­search­ing and for­mu­lat­ing strate­gies to strengthen the in­sur­ance sec­tor for the ben­e­fit of the econ­omy. The role will also in­volve en­gag­ing with a range of stake­hold­ers from the in­sur­ance in­dus­try.

QWhat are your ob­jec­tives for the new de­part­ment?

In the im­me­di­ate term, the fo­cus will be on the or­derly im­ple­men­ta­tion of the Life In­sur­ance and Fam­ily Takaful Frame­work (LIFE Frame­work) and phased lib­er­al­i­sa­tion of the mo­tor and fire classes of busi­ness.

Our longer term goal is es­sen­tially to have an in­sur­ance sys­tem that meets the needs of a high in­come and high value-added econ­omy. Such an in­sur­ance sys­tem must be in­no­va­tive, ef­fi­cient and sus­tain­able. I will briefly un­pack th­ese in turn.

In­no­va­tion in the in­sur­ance sys­tem is ab­so­lutely nec­es­sary if we are to meet the needs of a grow­ing econ­omy. From a shift­ing de­mog­ra­phy, to rapid ur­ban­i­sa­tion and in­te­gra­tion with the re­gion, many forces will con­tinue to change the way in­sur­ance is sup­plied and con­sumed and it is im­por­tant that the in­sur­ance ex­pe­ri­ence con­tin­ues to match pub­lic ex­pec­ta­tions.

Ef­fi­ciency is im­por­tant to en­sure that ser­vices are of a high stan­dard and cus­tomers get good value, while en­sur­ing that all pro­duc­ers along the value chain are ad­e­quately re­warded and share­hold­ers get a rea­son­able re­turn on in­vest­ments.

Our longer term goal is es­sen­tially to have an in­sur­ance sys­tem that meets the needs of a high in­come and high value-added econ­omy.

Most im­por­tantly, all th­ese have to be pur­sued in a sus­tain­able man­ner to en­gen­der pub­lic trust and for the longevity of the sys­tem. This re­quires pru­den­tial safe­guards to evolve in tan­dem with a more ad­vanced in­sur­ance sys­tem.

Spe­cific ar­eas of pol­icy fo­cus in­clude di­ver­si­fy­ing de­liv­ery chan­nels for bet­ter out­reach and con­sumers’ con­ve­nience, driv­ing in­no­va­tion in busi­ness mod­els through new tech­nolo­gies, ac­cess to un­der­served seg­ments through mi­croin­sur­ance, health in­sur­ance with em­pha­sis on per­sonal and pre­ven­tive care, longevity pro­tec­tion, deep­en­ing the tal­ent pool and en­hanc­ing our ca­pac­ity for large and spe­cialised risks. Many of th­ese have al­ready been ar­tic­u­lated the Fi­nan­cial Sec­tor Blue­print 20112020.

QHow do you plan to de­liver th­ese goals?

We have em­barked on a re­view to iden­tify gaps and op­por­tu­ni­ties, in terms of the mix of mar­ket par­tic­i­pants, prod­ucts and de­liv­ery chan­nels that will help us achieve our goals. Be­yond the in­sur­ance sec­tor it­self, we will also need to think about the ecosys­tem within which in­sur­ance busi­ness op­er­ates. This in­cludes a wide range of fac­tors from the data in­fra­struc­ture to avail­abil­ity of tal­ent and en­gage­ment with the pub­lic sec­tor.

Clearly, much that needs to be done to achieve th­ese goals in­volves a wide range of stake­hold­ers. To a large ex­tent, the Bank acts as a fa­cil­i­ta­tor to get con­ver­sa­tions go­ing be­tween dif­fer­ent groups, en­sur­ing the best ideas are un­cov­ered and hope­fully get enough con­sen­sus to emerge through this process for the ac­tions of the dif­fer­ent play­ers to be mu­tu­ally re­in­forc­ing.

Com­mu­ni­ca­tion will be a key tool of the Bank in or­der to forge this con­sen­sus, so we will be spend­ing more time in di­a­logue with stake­hold­ers and even set­ting up con­sul­ta­tive groups with par­tic­i­pants from the in­dus­try and be­yond for ex­plor­ing new ideas in key the­matic ar­eas.

QIn your opin­ion, why is it nec­es­sary to cre­ate such a de­part­ment?

Pre­vi­ously, in­sur­ance de­vel­op­ment was part of a de­part­ment with a broader man­date for de­vel­op­ment of the whole fi­nan­cial sec­tor. Hav­ing a ded­i­cated de­part­ment for in­sur­ance de­vel­op­ment al­lows for bet­ter fo­cus to en­sure we achieve the de­sired goals for the in­sur­ance sec­tor.

QIs it re­lated to the up­com­ing lib­er­al­i­sa­tion move?

The for­ma­tion of this de­part­ment was not driven di­rectly by the lib­er­al­i­sa­tion mea­sures them­selves but rather the stage in the evo­lu­tion of our in­sur­ance mar­ket that is sig­ni­fied by the lib­er­al­i­sa­tion move.

From our per­spec­tive, the foun­da­tions of fi­nan­cial strength and risk man­age­ment laid in the pre­ced­ing decade has po­si­tioned the mar­ket to be ready for a step in­crease in the level of in­no­va­tion and com­pe­ti­tion, which we ex­pect will ul­ti­mately ben­e­fit the con­sumer through bet­ter qual­ity ser­vices and more choices to meet spe­cific needs.

QMalaysian in­sur­ance in­dus­try is un­der­go­ing sig­nif­i­cant trans­for­ma­tion over 5 to 10 years to ad­dress the un­der­in­sur­ance is­sue. What are your thoughts on this?

Spe­cific ar­eas of pol­icy fo­cus in­clude di­ver­si­fy­ing de­liv­ery chan­nels for bet­ter out­reach and con­sumers’ con­ve­nience, driv­ing in­no­va­tion in busi­ness mod­els through new tech­nolo­gies, ac­cess to un­der­served seg­ments through mi­croin­sur­ance, health in­sur­ance with em­pha­sis on per­sonal and pre­ven­tive care, longevity pro­tec­tion, deep­en­ing the tal­ent pool and en­hanc­ing our ca­pac­ity for large and spe­cialised risks.

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