New Takaful Players To Drive Industry's Growth, Says Expert

BERNAMA: New takaful players maturing by now are likely to be the driver of growth for the industry to met the target of 20 percent by 2010, according to a takaful expert.

Currently, takaful penetration is about seven percent compared to 40 percent by conventional insurance, said Takaful Ikhlas Sdn Bhd's president and chief executive officer, Syed Moheeb Syed Kamarulzaman, who has been in the takaful and insurance industry for more than 30 years.

Speaking on the "Hello Malaysia" programme produced by Bernama TV recently, he said the central bank had set a target for takaful players to capture 20 percent of the conventional business.

Saying that this is achievable, he added that the new takaful players are likely be the driver for the growth with a realistic target between 15 and 20 percent.

"These new players are maturing about now and I think their network, their distribution as well as infrastructure are blooming now (and) that will perhaps push the industry towards that target," he said.

Of the eight takaful companies, six were only established in the last two years, and among them are Prudential BSN Takaful, AIA Takaful International Bank and HSBC Amanah Takaful (Malaysia) Sdn Bhd.

However, Syed Moheeb said it would be a challenge for them to create awareness among Muslim consumers on takaful benefit as the group accounted for 40 percent of the conventional insurance.

On stiff competition amid the global financial turmoil, he said Takaful Ikhlas has set a strong framework to address new competition and face the financial uncertainties.

"Our strategy has always been ensuring very high level of services for customers as I believe it is service excellence that will ensure continuous profitability and future's growth," Syed Moheeb said.

At the same time, the company was also focusing on building stable and strong human capital to create a strong distribution channels not only in urban areas but also rural areas, he said.