“The tremendous growth in the family Takaful segment, especially in Malaysia, outpaces that witnessed by both general Takaful and the conventional life insurance market. Between 2007 and 2011, net contribution for Family Takaful increased at a compounded annual growth rate of 20%, outpacing general Takaful business. Given the large untapped market that still exists with only 54% of the population having a life insurance or Family Takaful policy, there is significant room for growth in Malaysia,” Shahril Azuar Jimin, Chief Commercial Officer of Etiqa Insurance and Takaful told the audience at the opening of the two-day the 3rd Annual World Takaful Conference: Family Takaful Summit Malaysia (WTC: FTS 2012).
“With stiff competition among Takaful players placing pressure on profitability, the Family Takaful segment can be seen as a long term sustainable proposition with strong bottom-line returns. With growing awareness and increasing demand for savings and investment-driven products in Malaysia, Family Takaful products have a significant opportunity to translate this positive trend into an impetus for ongoing strong growth. Etiqa believes in and supports the role of a powerful agency force in ensuring an exciting future for Family Takaful,” he added.
WTC: FTS 2012 which started on Monday in Hotel Istana, Kuala Lumpur, witnessed a high profile opening with more than 500 Takaful operators and agents engaging in discussions on how to capitalise on the huge growth potential for the Family Takaful industry in Malaysia and discussed key strategies for positioning and supporting Family Takaful as the key growth engine for the Takaful industry in Malaysia. The event, held under the support of Etiqa Takaful Berhad, highlighted the importance of empowering agents to be the driving force of Family Takaful growth.
A key highlight of the 3rd Annual World Takaful Conference: Family Takaful Summit (WTC: FTS 2012) was the special keynote address delivered by Y.B. Senator Dr. Masitah Ibrahim, Deputy Minister at the Prime Minister’s Department, Malaysia on behalf of Y.B. Senator Mejar Jeneral Jamil Khir Bin Baharom, Minister, Prime Minister’s Department, Malaysia.
“With the Family Takaful segment dominating the Malaysian Takaful market, the strong growth momentum is expected to continue, underpinned by the rising affluence of Malaysia amidst strong economic fundamentals. Given the large untapped market that still exists, the Takaful industry in Malaysia is poised for further major growth. However in order to ensure that the industry is successfully positioned to fully tap into the dynamic growth opportunities, it is essential to build a pool of highly skilled talent and a knowledgeable workforce,” David McLean, Chief Executive of the World Takaful Conference, said.
“As the industry seeks to achieve a higher level of competitiveness, increased product complexity, business sophistication, service excellence and the global nature of competition are all demanding a greater depth and breadth of leadership, knowledge, competence and core skills from industry Professionals – in particular, the agents – who are the core distribution channel for Family Takaful,” he added.
Assessing the progress of the international Takaful industry, Sohail Jaffer, Partner and Head of International Business Development at FWU International noted that “Malaysia continues its leadership position in the Family Takaful market with the Family Takaful segment holding around 73% of the total Takaful market share whereas in the GCC it is only about 5%.”
“Though increased awareness of the need for financial protection and economic growth resulting in more affluent customers with high disposable income act as drivers of Family Takaful growth, challenges such as lack of product innovation, shortage of Takaful expertise and lack of customer education need to be overcome in order to realize the full growth potential of the industry.”