Syarikat Takaful’s digital push
Takaful operator is open to local and foreign partners
PETALING JAYA: Syarikat Takaful Malaysia Bhd (STMB), which has the highest return on equity among all government-linked companies, is upbeat the company’s digital strategy will help maintain its leadership in family takaful business and gain further strength in the general takaful segment.
The oldest takaful operator currently commands 23% of the family takaful market, making it the market leader in this segment. The company ranks number two with a similar market share (23%) in the general takaful business.
Group chief executive officer Datuk Seri Mohd Hassan Kamil ( pic) expects a positive performance from the company this year despite the challenging financial landscape. He told StarBiz this will be primarily driven by promising premium growth and better investment returns.
Mohd Hassan noted that the premium growth rate for both family and general takaful businesses will continue to outpace the industry’s growth rate.
Last year, its family business grew at 11% while the general takaful business grew 20%.
He said the company would prioritise the development of digital products and services to cater for the changing demands of consumers.
He added that to boost digital capabilities, Takaful Malaysia was open to both local and foreign partners and exploring new opportunities with providers of social messaging apps and e-wallets to wider access its new customer base.
“We are embarking on other digital initiatives that include system integration with our key business partners, online self-service options and a mobile application as part of the company’s holistic digital strategy to stay relevant in the ongoing digital revolution and meet ever-rising consumer expectations.
“The company will also introduce more online products such as term life, critical illness and Travel PA Takaful that are scheduled to be offered via our online self-service platform, Click for Cover, later this year.
Early this month the company launched its online sales portal Click for Cover and anticipates a 20% to 25% rise in online sales in the first year.
“Another growth driver adopted is the development of a unique topup medical plan called Takaful myClick MediPlus to augment our leading position in the employee benefits segment,” he noted.
For the fourth quarter ended Dec 31, 2017, STMB’s net profit surged 43% to RM56.30mil compared to the same quarter a year ago. Its quarterly revenue grew 5.48% to RM517.74mil.
For the full year, the company recorded a 17.26% rise in net profit to RM206.7mil. Revenue for 2017 was RM2.14bil against RM2.013bil in the previous year. It also declared a single-tier interim dividend of 15 sen per ordinary share amounting to RM123.5mil.
Net return on equity came in at 26.7% compared with 24.9% reported in financial year 2016, the highest return on equity among all government-linked companies.
Going forward, Mohd Hassan said the company would employ multi-distribution strategies in reaching out to a wider customer base and explore business opportunities with major Islamic financial institutions, among others.
As to whether there were plans for mergers and acquisitions this year, he said: “Business expansion through M&As can be a quick way to achieve the optimum company size to compete more effectively after the separation of licences.
“However, we will only explore this option if it can clearly add superior shareholder value to STMB and the new acquisition can complement the company’s business growth strategy. We are yet to venture into such an initiative at the moment.”