Syarikat Takaful Malaysia

Syarikat Takaful Malay­sia Bhd, Malaysia’s oldest takaful establishment, is gearing up to face greater competition as more for­eign multinationals enter the field as part of the government’s liberalisation measures.

Tighter lending measures imposed by Bank Negara Malaysia are adding to its pressures, as the Islamic insurer saw sales from its largest contributor to revenue, family takaful, take a hit in the first quarter (Q1) of FY14.

However, analysts have confidence the market leader will remain a step ahead of its closest rivals, which include bank-backed insurers and multinational players. The latest entry into the takaful field, AIG Malaysia Insurance Bhd, has obtained the required regulatory approvals and is looking at setting up a retakaful business this year.

The takaful market in Malaysia is getting more competitive, especially with the entry of bigger multinational companies, a low penetration rate in takaful plus an increasing focus on the liberalisation of the takaful sector. The newcomers are likely to make a push for market share, so existing bigger players may become aggressive to regain market share. Competitive pressure on existing takaful players will increase.

Takaful Malaysia is the market lead­er in family takaful with a 40% market share, and is also market leader for the combined family and general takaful business with 23%. Being aggressive means coming up with cutting-edge selling propositions and innovative products.