AGROBANK, TAKAFUL IKHLAS IN PARTNERSHIP
Firms expect win-win tie-up to contribute positively in medium term
LIDIANA ROSLI KUALA LUMPUR lidiana@nst.com.my
THE five-year exclusive collaboration between Agrobank Bhd and Takaful Ikhlas Bhd (TIB) will enable both companies to further their own respective objectives.
Agrobank president and chief executive officer (CEO) Datuk Wan Mohd Fadzmi Wan Othman said this collaboration would be a “win-win” for Agrobank and TIB, as he sought to enlarge his bank’s fee-based income and TIB seeking to capture the rural market.
“We have always been keen in developing our bancassurance business and we believe this exclusive partnership with TIB will help deepen this particular segment, which as of the end of last year contributed some RM40 million to our bottom line,” said Wan Mohd Fadzmi.
“Of course, if you compare that with commercial entities, it is not a big number. But for a agriculture-centric development financial institution like us, with no technical expertise in takaful, it is significant. We are also expecting this partnership to contribute positively in the medium term.”
He said though Agrobank was keen to tap further into the feebased business, which was less risky and almost immediately profitable.
“We are, of course, looking at other avenues to enlarge our feebased income, but I would have to say that this collaboration with TIB, one of the country’s most prominent takaful providers, is significant and prominent,” said Wan Mohd Fadzmi.
“This is not only because of their technical know-how, but like us, they are also Islamic and this means we will have perfect synergy with each other.”
The memorandum of understanding signed by both entities will see them working together in the areas of personal accident takaful, mortgage takaful, group credit term takaful, group family takaful, family takaful plans for education, retirement and medical, motor takaful, fire takaful and other non-motor takaful products.
TIB president and CEO Datuk Ab Latiff Abu Bakar said he was targeting RM211 million in total premium contributions across all segments in the collaboration.
“We have seen a very healthy take-up rate of Agro Nurani offering. To date, it has attracted more than 350 policyholders, contributing some RM28,000 to the company since its soft launch on January 14,” said Ab Latiff, noting that Agro Nurani was the country’s first takaful plan for the disabled.
“This policy is available to any disabled person’s cardholders and cover conditions like mental illness as well. Next policies that we will roll out would be an educational plan sometime in the middle of the year.”
By partnering with Agrobank, TIB will also be able to tap the rural Malays, which makes the bulk of Agrobank’s clientele.
“We are still targeting the urban demographic, but we are now enlarging our market by also going into the outskirts,” he said.
TIB has more than two million policyholders as well as an estimated 5,000 registered agents nationwide.