Takaful Malaysia to up market share
Dec 4th, 2008 by Takaful
Source: The Star, 4th December 2008
Syarikat Takaful Malaysia Bhd (Takaful Malaysia) intends to expand its market share in terms of asset size to 50% from 40% over the next 12 months with the launch of its new series of wakalah-based products.
Group managing director Datuk Hassan Kamil expects the takaful market to be robust and hopes to regain its number one position over the next five years.
“We plan to launch four more wakalah-based products next year,” he told reporters after the launch of four wakalah-based products yesterday.
Takaful Malaysia has over 70 branches nationwide and total assets of RM4.05bil as at June 30, an increase of about 15% from the previous year.
In line with its objective to be more competitive, the company is moving from mudharabah to the wakalah model.
Under the mudharabah model, customers’ premiums are fully invested and profits from these investments are used to cover administrative fees. In contrast, under the wakalah model, a percentage of the premiums would be taken upfront for administrative fees and the balance invested.
“While existing products are based on the mudharabah model, all new life (family) products to be introduced will be based on the wakalah model,” Hassan said.
The wakalah-based products would enable Takaful Malaysia to compete with the conventional life insurance business in terms of the compensation structure of upfront fees and commissions to the intermediaries in order to grow its retail segment of the business.
Chairman Tan Sri Hadenan Abdul Jalil said the wakalah model was widely accepted in the Middle East and also practised by all the other takaful operators in the country.
The new wakalah-based products are Takaful MyMedicare, MySiswa, MyImpian and MySinar.
According to Hadenan, the highlight of the series is MyMedicare, a cashless hospital and surgical takaful plan that provides 24-hour worldwide protection, cashless admission to the company’s panel hospitals as well as surplus sharing, payable annually.
On another matter, Hassan said Takaful Malaysia unit PT Syarikat Takaful Indonesia was seeking a strategic banking partner in the republic to take up a 30% equity stake by end-2009 to expand its takaful operations there.
The group was also injecting RM20mil to revamp the information technology system in its Indonesian business over the next two years.