News Digest 20100110-20100116

Insurance News It is TM Asia's turn to say that they want to double their premiums, but this time it seems to be a target set for only Sabah or the most for East Malaysia. The company also wants to be 1 of the top 5 in 2 to 3 years' time mainly through its agency force. http://bit.ly/6BDdfE

TM Asia Life aims to double premium
TM Asia Life Malaysia Bhd, which has embarked on an expansion plan in East Malaysia, hopes to double new business premium with the opening of its new premises in Kota Kinabalu. The company, with a strong ...

Insurance News Vincent Kwo is now COO for MAA. http://bit.ly/8O41Hb

MAA appoints chief operating officer
MALAYSIAN Assurance Alliance Bhd (MAA) has appointed Vincent Kwo Shih Kang as chief operating officer from January 2. Kwo, 49, graduated from City University, London, in 1982 where he obtained a Degree ...

Insurance News AXA Affin does not rule out acquisition to achieve its 8% market share target. Our view is that this may in fact be a more feasible route given that doubling the premiums every year is not an easy task at all. Perhaps AXA should explore with UOB and see whether the latter has intention to sell its insurance units in Malaysia? http://bit.ly/6dFGcH

AXA Affin not ruling out acquisitions, partnerships
AXA Affin Life Insurance Bhd hopes to grow its share of the local life insurance market from 1.5 per cent to 8 per cent by 2012, as it undertakes a AXA global branding exercise.Its chief executive officer ...

Insurance News It is unusual to have an Islamic bank that doesn't have any takaful operations to comment on takaful. OCBC Al-Amin commented that the growth of takaful lagged behind Islamic banking. Great Eastern, which is owned by OCBC, is believed to have applied for 1 of the 2 new takaful licences to be issued this year. GE has also recruited the ex-CEO of Prudential BSN to enhance its chance of getting the new licence. http://bit.ly/6hKEVH

Malaysian takaful growth lags banks
Growth in Malaysia’s takaful Islamic insurance industry has lagged the sharia banking sector as insurers struggle to find a home for premiums and players lack distribution channels, Singapore’s ...

Insurance News AXA Afiin Life needs to double premiums to be top 5 player by year 2012. http://www.actuaries.com.my/news/2010/01/axa-affin-life-needs-to-double-premiums.html

Insurance News: AXA Affin Life needs to double premiums
www.actuaries.com.my
Axa Affin Life has a huge target to achieve by year 2012. It has to grow its market share from the current 1.5% to 8%, to be among the top 5 in the industry. Its NB premium was RM162 mil in 2009, the target set for 2010 is RM320 mil and RM100 mil for total premiums and weighted premiums respectively...

Insurance News Dedicated to all our readers who are insurance agents. http://www.youtube.com/watch?v=ysA-wtl8-YI&feature=autofb

Insurance agent - Bangkok Life advertisement
Bangkok Life Assurance advertisement

Insurance News CIMB Aviva Takaful launched EasyLife Takaful Series and expects to secure contributions of RM35-40 mil. The takaful player aims to increase its market share from the current 2-3% to 5% in 2 years time. There are currently 8 takaful players in the market with 2 new licences to be issued soon. http://bit.ly/6nmFtQ http://bit.ly/6p0TRW http://bit.ly/5Q3TlO

CIMB Aviva aims for 5pc market share
CIMB Aviva Takaful Bhd is looking to increase its market share to five per cent in two years in line with the steady growth of the takaful industry, chief executive officer Muhammad Fikri Mohamad Rawi ...

Insurance News CIMB Wealth Advisors which started distribution for AIA since March 2009 secured RM7.6 mil premium in 2009. It sets a target of RM25 mil for 2010 planning to tie up with more insurers after obtaining its financial advisor licence. http://bit.ly/6ceiyR

CIMB Wealth sees RM25m premiums
CIMB Wealth Advisors Bhd aims to secure RM25 million premium this year from insurance and takaful products, chief executive officer Tan Beng Wah said today.The company managed to secure RM7.6 million premium ...

Takaful Health

Prudential BSN Takaful today launched Takaful Health, a sister product of PRUhealth, whereby a no claim bonus of up to RM500 will be paid if there is zero claim in previous certificate year.

Other features:

• Provides comprehensive hospital and medical coverage
• Coverage until 80 years old
• Rider to Takafulink (protection) and Takaful Cerdik (education)

Source: The Star

News Digest 20091105-20091116

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PruBSN's new CEO

Azim Mithani will soon become the CEO of Prudential BSN Takaful.

Earlier post: More actuaries are becoming CEOs

Source: The Star

Great Eastern hires takaful head

Great Eastern hired Mohamad Salihuddin Ahmad some 2 months ago to head its future takaful unit. Salihuddin was previously CEO for Prudential BSN. It is believed that his previous position in PruBSN has recently been filled.

Great Eastern is applying for 1 of the 2 new takaful licences to be awarded by BNM later this year.

Source: Business Times, TASclusive

Prudential's 2009 Q1 Results

Highlights of Prudential's 2009 Q1 results:

• Sales was down 5% groupwide compared with 2008 Q1
• In Asia, sales was down 11%, regular premiums declined 2%, single premiums decreased 72%
• Linked business was 40% (2009 Q1) and 62% (2008 Q1) of total APE

In Malaysia:

• Achieved APE of £24 mil, up 60%, premiums for protection benefits was 50% of APE
• 500 new agents added
• APE per active agent increased 10%

Source: The Star, Prudential

Takaful penetration rate is low

PruBSN says that takaful penetration rate of 7.7% is low compared to 40% in conventional.

Facts on PruBSN:

• 10,000 agents, 50% are non-Muslims
• 216,000 certificate holders, 35% are non-Muslims
• RM300 mil in regular contributions

Source: Bernama

PruBSN Asas

PRUDENTIAL BSN Takaful Bhd has launched PruBSN Asas. Some product features:

• Covers TPD and death.
• 3 supplementary riders: AD&D, accidental medical reimbursement and weekly indemnity.
• Contribution starts from RM20.

Source: Business Times

PruBSN to get more aggressive in bancatakaful

Prudential BSN is going more aggressively in bancatakaful, launching a drive to recruit 150 takaful financial executives (TFEs). The TFEs will be placed at BSN branches nationwide and will get a basic salary as well as incentives for every new and renewal business that they successfully close.

Source: Business Times

Has Prudential overtaken Great Eastern?

Prudential claimed that it had attained the top position in the Malaysia life insurance market. It captured RM659 mil new business weighted premium, compared to RM606 mil in 2007. The figures apparently include the sales figures of Prudential BSN Takaful.

Great Eastern, the leader in conventional business, does not currently have takaful licence.

Source: Business Times, Prudential

PruBSN to open 7 new branches

Prudential BSN Takaful Bhd (PruBSN) will open 7 new branches in 2009 costing RM1 mil each. The branches will be located in state capitals.

Some business statistics:

• Total new regular contributions of RM340 mil (95% family takaful, 5% general takaful)
• 35% market share in NB growth
• 200 staff, 9,000 agents
• 70% agents non-Muslim
• 190,000 takaful participants (34% non-Muslim)

A new product called PruBSN ASAS will be launched in Q1 2009.

Source: Bernama

Takaful Puteri

Prudential BSN Takaful launched 2 new riders: Takaful Puteri and Takaful Puteri Plus.

Product features:

• To be attached to Takafulink Plan
• Entry age: 19 to 60
• Expiry age: 60, 70 and 80
• Takaful Puteri provides lady care benefits: women-related illnesses, specified treatments such as skin grafting due to skin cancer and burns, facial reconstructive surgery due to accidents
• Takaful Puteri Plus has mother care benefits which covers pregnancy complications and infant congenital illnesses
• 3 sums assured to choose from: RM50,000, RM100,000 and RM150,000

Source: Business Times & TAS Research

PruBSN to Boost Non-Muslim Market

Prudential BSN Takaful Bhd (PruBSN) plans to strengthen its position in the non-Muslim market, which makes up 35% of its customers.

Some business initiatives in the pipeline:

• A pure protection product for bancatakaful to be introduced this year.
• 2 new products and 2 new riders to be launched next year for agency distribution.
• Offices to be set up by end-end in Shah Alam, Johor Bahru. 3 more in other areas next year.

A marketing and administration centre was set up in Wangsa Maju last Friday.

Source: Bernama

Partnership with Standard Chartered Extended

Prudential has extended its bancassurance partnership in Asia with Standard Chartered to 2016.

Other details:

• The markets covered has been broadened to include Japan and Thailand in addition to the original Hong Kong, Singapore and Malaysia.
• New products now included in the partnership: A&H aand Takaful products.
• A separate partnership agreement between the two companies covers 3 other countries: China, Taiwan & Korea.

Source: Investment Week

Takaful Annual Statistics 2007

The takaful industry saw a 3-fold increase in the agency force from 15,194 in 2006 to 43,843 in 2007. However, net contributions income only improved by 49%.

It is believed that the increase in the number of agents was caused by the new licensees such as Prudential BSN, HLTMT and MAA. Although the new licenses were granted in 2006, most of the new licensees only started business in 2007. Another new licensee HSBC Amanah Takaful does not have agency force but distributes mainly through HSBC bank.

It is interesting to note that the number of employees for the takaful industry only increased by 200-300 from year 2005, despite the entry of the 4 new players. This is because the new players mainly adopt shared resources model (sharing with their traditional insurance business) and this helped to improve efficiency as the management expense ratio for general takaful has decreased from 34.3% to 29.7%.

The per capita contributions on family and general takaful were still low at RM73.2 and RM20.8 respectively compared with the traditional counterparts of RM695 and RM369.

Is the Malaysia Takaful market growing too slowly? Our earlier article has highlighted the threat that MIFC may not achive its targets as GCC has already claimed to be the largest takaful market in the world.

By class of business, we saw investment-linked and motor takaful increase in share in new business in 2007. This may be a result of the new licensees' strategies. It is worth noting that the claims ratio for general takaful has deteriorated from 59.2% to 71.5%, mainly due to the poor performance of motor business.

Source: BNM

Prudential BSN Takaful Grew 70%

Prudential BSN Takaful business enjoyed a 70% growth rate in Q1 2008 compared to the same quarter last year.

The takaful business now represents 28% of the total Annual Premium Equivalent (APE) in Malaysia, doubles the 14% last year.


Source: Prudential