Malaysian insurers have sufficient capital reserves, regulator says

0


[ad_1]

The overall capital adequacy ratio of the Malaysian insurance industry was 221.2%, well above the regulatory threshold of 130%. All licensed insurers and takaful operators had capital ratios exceeding internal target levels, ranging from 150% to 250%.

At the end of June, the total excess equity above the regulatory minimum stood at MYR 36.8 billion (SGD 11.98 billion).

“Going forward, volatility in financial markets and the prospect of rising bond yields will continue to weigh on the earnings of insurers and takaful operators given their large financial investments,” BNM said in its review report. of financial stability in the first half of the year. “Nonetheless, the insurance and takaful sector is expected to remain resilient.

BNM said several life insurers have introduced additional underwriting criteria related to the pandemic, including questions assessing the medical history of COVID-19 and the risk profile of potential policyholders. The increased risk has also resulted in higher premiums or longer waiting periods for some policyholders.

However, the regulator said these did not indicate a widespread tightening of underwriting conditions induced by a pandemic in the industry.

The general insurance and takaful segment saw a slight increase in profitability, with MYR 1.8 billion for the first half of 2021, compared to MYR 1.7 billion compared to the same period last year. This is explained by the improvement in subscription performance. Turnover also improved by 5.1%, mainly due to the revision of premium rates in fire, all contractors’ risks and in engineering, following several major claims in recent years. This was also supported by an increase in car sales due to the extension of the vehicle sales tax exemption and the easing of restrictions related to the pandemic.

[ad_2]

Share.

Leave A Reply