Life Insurance Products Of Malaysia

1315 Words May 16th, 2016 6 Pages
Life insurance products in Malaysia
The life insurance industry in Malaysia can be divided to family takaful and conventional life insurance. Both family takaful and conventional life insurance are similar in providing protection against the loss of income that would result in the death of the insured. However, unlike the conventional life insurance in which the insured transfer the risk to the insurer, takaful mutual risk is shared among the participants. Another major difference between them is the ownership of the companies. A conventional life insurance company is owned by shareholders whose objective is to maximize profits while a takaful company is owned by the participants whose objective is to minimize the cost incurred. The total premium for in-force policies of the life insurance industry in Malaysia recorded a 6.6% growth which came to around RM32 billion in 2015 compared to 2014. Although family takaful only had RM 3.4 billion for in-force policies, they grew significantly at 12.7% in 2015. The total premium volume of conventional life insurance and family takaful products to Malaysia’s GDP is around 3.3% in 2015.

Context of marketing life insurance products in Malaysia
Regulation
In Malaysia, the regulator of takaful and the insurance industry is the Central Bank of Malaysia (Bank Negara Malaysia, BNM). All insurance companies are licensed by the Minister of Finance on the recommendation of the BNM. The latest regulatory framework for the insurance industry in…
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