After more than a year with numerous rumors and speculations pertaining the new takaful licenses, Bank Negara Malaysia had finally released (1/9/10) the news that the following entities are awarded with new Takaful licenses but only to transact family businesses:
American International Assurance Berhad (70%) and Alliance Bank Malaysia Berhad (30%); AMMB Holdings Berhad (70%) and Friends Provident Group plc, UK (30%) ING Management Holdings (Malaysia) Sdn Bhd (60%), Public Bank Berhad (20%) and Public Islamic Bank Berhad (20%); and The Great Eastern Life Assurance Company Limited (70%) and Koperasi Angkatan Tentera Malaysia Berhad (30%);
Well, most of them are considered major players in the conventional insurance industry in Malaysia thus I would expect that they may kick off faster than those in the past. AIA had been issued an ITO (International Takaful Operator) license previously thus this new takaful license would compliment well with ITO license for their aggressive market penetration. ING may have an advantage due to to its partner which is a very strong FI in local market. Furthermore, ING had also partnered with a local takaful operator in promoting their employees benefit schemes to the Islamic prospects giving them some exposures to the takaful management. GE had a strong agency team in conventional which definitely be their competitive edge like PruBSN Takaful. AM Group with its subsidiary, AMAssurance, may have advantage from the partnership with oversea partner in terms of expertise and perhaps capital. We hope to see new innovation in products and services for the benefits of Malaysians in general.
Few advise perhaps from me is that the new takaful operator shall be named with an appropriate name in accordance with the Islamic phrases and if possible try to disassociate from the conventional name. This is critical in order to be effective in marketing strategies. Furthermore, key personnel especially CEO must be a Moslem where this will send a positive message to the community or society that the operator is serious about doing takaful or Islamic insurance and not merely for profit. As the license is only to transact family takaful, the core team must be those with strong family/life technical background with solid marketing experience. There are few (one or two) leaders in the takaful operators who are general practitioners thus making their life or family business moving a bit slow than expected.
Be careful when employing those from the conventional industry as there are several aspects differ significantly in takaful operations. Core team must comprise mainly those with solid background in takaful so that they can lead the rest towards the right direction in takaful philosophies.
I wish all those new takaful players "Good Luck and Welcome on Board" and please ensure that the main focus is strictly adhered i.e. to promote Islamic insurance with honesty, fairness and integrity.
