Although Malaysia is a leader in Islamic finance research, very few of the research papers published have translated into feasible innovations, until recently. To help push the sector forward and bring the research and ideas to fruition, International Centre for Education in Islamic Finance, with the support of Bank Negara Malaysia, the Association of Islamic Banking Institutions Malaysia and the Malaysian Takaful Association, recently held the Islamic Finance InnoFest 2016. For this festival, INCEIF accepted idea submissions from all over the world, including Japan, Australia and Pakistan, to promote inclusiveness.
“We believe that to really push for innovation, we cannot be stuck in a silo. That is why it is not limited to only Malaysians,” says Associate Professor Dr Baharom Abdul Hamid, director at INCEIF’s Centre of Research and Publication and InnoFest chairman.
#Malaysia’s #takaful industry is set to double its growth rate this year as companies focus on selling cheaper policies in rural areas. Malaysian Takaful Association's chairman Ahmad Rizlan Azman said the number of policies would rise 10% to 5.05 million in 2016, compared with 4.3% growth in 2015. Insurers entering the micro-takaful market and the liberalisation of commission structures are the biggest drivers.
#islamicfinance - #Malaysia’s #takaful industry is set to double its growth rate this year as companies focus on selling cheaper policies in rural areas, according to the Malaysian Takaful Association. The number of policies will rise 10 % to 5.05 mn in 2016, compared with 4.3 % growth in 2015 and a 1 % estimated expansion of non-Islamic business, Ahmad Rizlan Azman, chairman of the Association, said.
Malaysia’s takaful industry grew at a faster rate than conventional insurance, recording a compound annual growth rate of 12.4% in the last five years and outperforming the conventional insurance’s CAGR of 7.8%. Malaysian Takaful Association chairman Ahmad Rizlan Azman said takaful contributions last year were RM6.3 billion, accounting for a 13% share of the total insurance market.
“With Malaysia’s low insurance penetration rate of 5.2% of gross domestic product (GDP) in 2014 and its young demographics, significant market growth opportunities are yet to be tapped by its insurance and takaful sector,” Ahmad Rizlan said at the launch of the Malaysian Takaful Dynamics report on the sidelines of the 11th World Islamic Economic Forum yesterday.
The jointly developed report by the Malaysian Takaful Association and Ernst & Young (EY) Malaysia is the country’s first central compendium on Islamic insurance.
Ahmad Rizlan said the low penetration rate of takaful in the country is due to a lack of awareness about takaful-related products as well as the issue of affordability, especially among low-income groups.
Malaysia’s Islamic insurers are seeking to double policy holders in five years by investing more in digital technologies to attract a younger audience, according to Ahmad Rizlan Azman, chairman of the Malaysian Takaful Association. Takaful operators should also step up educational campaigns to boost customers to 8.4 million by 2020 from about 4 million now, he said. Attracting more professionals is another prerequisite to achieving Malaysia’s targets, Ahmad Rizlan added. Syarikat Takaful’s Mohammad Hassan said the nation’s Islamic insurers have to push for innovative new ideas to keep their growth momentum going. The company is considering an acquisition in the next two years to increase its customer base, he said.