The medical and health, and liabilities classes grew by 16.7% and 10.5% last year as compared with 2007, said Bank Negara insurance and takaful supervision department director Yap Lai Kuen. She said the personal accident class posted a 9.2% growth during the same period.
“Even though 2008 has been challenging, the insurance industry has maintained an overall high volume of business,” she said when opening the inaugural Sarawak insurance agency seminar yesterday.
However, Yap said the life insurance’s new business annual premium equivalent registered RM7.2bil last year, down from RM7.6bil in 2007. She said this was due largely to a decline in sales of investment-linked business.
“It is worthwhile to note that ordinary life recorded a strong growth of 18.6%, thus demonstrating the industry’s ability to adapt to a changing business environment,” she added.
Yap said Bank Negara had recently issued a concept paper - “Guidelines on the introduction of new products for insurance companies and takaful operators” - in which fair treatment of consumers was highlighted.
She said the paper stressed the need for insurance companies to put in place policies and procedures to ensure that customers were fully informed through appropriate disclosures of the key features, terms and conditions and risks associated with the product. The product must also be appropriate for the target group of consumers taking into consideration their broad needs and risk appetite, and compensation arrangements for sales staff and agents must not induce an excessive bias towards high revenue-generating products that they are likely to result in unsuitable product advise or sales to customers.
Yap said insurance companies must be seen to be actively involved in combating fraudulant practices and money laundering to boost their integrity and trustworthiness.
She said insurance agents had to keep up-to-date in terms of technical competency, maintain a high standard of ethical behaviour and provide customer-orientated services.