By Agency Reporter

Tuesday, 21 Dec 2010

PETALING JAYA: The insurance sector is expected to continue its growth momentum, albeit at a slower pace, with the life insurance business projected to grow by at least 12 per cent next year.

Life Insurance Association of Malaysia president, Adnan Md Zain said, “With the economic growth projected to be around five per cent next year, coupled with the recent Economic Transformation Programme initiatives, such as the Employee Insurance Scheme, Private Pension Scheme and the Foreign Workers Health Insurance Scheme, we should see the industry topping at a pace of at least 12 per cent in new business sales next year.”

New business sales rose by 19 per cent on a weighted premium basis in the first three quarters of 2010 attributed by a strong performance in regular premium sales which went up by 21 per cent, compared with the same period last year. Single premium business, however, registered a small decline of one per cent.

PIAM’s Lim demand for medical and health insurance is expected to remain strong

With the low interest rate environment and higher disposable income, he said there was fresh impetus for consumers to seek high yielding products like insurance.

There was also a lot of potential in the life insurance market, as the current penetration rate of 41 per cent was lower than the more developed Asian economies, Md Adnan told StarBiz.

With rising medical costs and a slight uncertainty in the market, he said products such as health/medical; protection and savings related products would be the dominant types that would take the lead in seeking better penetration and growth.

Expressing a more optimistic outlook, Great Eastern Life Assurance Bhd its director and Chief Executive Officer, Koh Yaw Hui, said the insurance market was projected to grow very strongly in the region of 15-20 per cent next year. He added that the growth was underpinned by the strong growth momentum expected from the takaful business, especially with the issuance of four new family takaful licences this year.

Source: Punch