KUALA LUMPUR – The Malaysian Takaful industry continues to show resilience during the pandemic with an increase of 7% new business contribution for all Family Takaful certificates in 2020, amounting to RM 6.59 billion as compared to RM 6.16 billion in 2019. The new Takaful protection value has increased by 21.4% to RM 461.7 billion, from RM380.2 billion in 2019.
The Family Takaful new business single gross contributions registered RM 5.09 billion in 2020, an increase of 4.9% from RM 4.85 billion in 2019. while the Family Takaful annual gross contributions of new business have recorded RM1.50 billion in 2020, double-digit growth of 14.8% when compared to RM 1.31 billion in 2019. In terms of distribution channels, Bancatakaful was the main contributor with 41.6% followed by Agency for 25.1%.
As a whole, the takaful industry added 839,358 new certificates in 2020, marked a significant growth of 14.4%.
This resulted in a notable growth of Family Takaful industry penetration rate, a measure of the number of inforce certificates to the total Malaysian population, which has increased to 16.9 % in 2020 from 15.9% in 2019. This also demonstrates that the industry’s Takaful protection value has reached RM1.1 trillion, an increase of 14.5% from 2019.
The General Takaful business registered Gross Written Contributions of RM 3.46 billion, an increase of 4.4% over the same period in 2019. Motor Takaful portfolio remains at the top position with a share of 66.1% [2019: 64.8%] of the portfolio mix.
In terms of distribution, both agency and direct distribution channels are the main contributors to the overall growth of general takaful, 59.4% and 31.7%, respectively. It is also worthy to mention the growth of the Internet channel which has been encouraging. This channel has grown by 22.1% from RM174.5 million in 2019 to RM213.1 million gross written contribution in 2020, 96.1% of which is motor takaful.
In terms of claims paid, the Net Claims Incurred Ratio (NCIR) has edged down to 55.7% in 2020. For the motor business, the industry’s NCIR decreased to 68.2% from 72.7% in 2019.
“This promising growth is evidence of positive outcome from reopening of the economy during COVID-19 pandemic under the Government’s recovery efforts to revitalise economic activities, especially during the third and fourth quarter of 2020,” said Encik Elmie Aman Najas, the newly elected Chairman of the Malaysian Takaful Association (MTA) on April 8.
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