Malaysian Takaful Association said the positive result was achieved on the back of the country’s post-lockdown recovery phase.
PETALING JAYA: The takaful industry posted a strong 2022 after seeing penetration rate of the family takaful segment grow to 20.1% last year compared to 18.6% in 2021, based on the number of certificates in-force relative to the Malaysian population.
The Malaysian Takaful Association (MTA) said the positive result was achieved on the back of the country’s post-lockdown recovery phase.
It was underpinned by a number of other factors, including the growing popularity of takaful products among consumers, the introduction of new innovative products, and the adoption of digital technologies to enhance service delivery.
The industry’s growth is further driven by increasing demand for Islamic finance products.
The growth is also due to the acceptance of takaful products as a viable alternative to conventional protection schemes, while making significant strides in digital transformation, with many players offering online platforms to purchase and manage takaful products, said the association.
MTA chairman Elmie Aman Najas commented that the strong demand for takaful products is due to the increasing number of Malaysians recognising the importance of protecting themselves and their families against financial risks.
He added that the number of certificates in-force for 2022 had increased to 6.63 million, compared to 6.07 million in 2021.
Delving deeper into the details, the association reported annual contributions of new businesses for family takaful market experienced a slight dip of 1.9% to RM2.19bil last year from the RM2.23bil garnered in 2021.
But overall, the family takaful new business industry registered RM10.06bil in gross contributions in 2022, an increase of 18.3% compared to RM8.05bil the year before.
At the same time, the number of new certificates also jumped to 15.6% to 1.31 million new business certificates in 2022, while gross contribution of total business in force was RM 8.34bil last year in contrast to RM7.42bil in 2021.
Meanwhile, other industry sectors showed similar encouraging growth as the general takaful business registered gross direct contributions of RM4.6bil, a 21.1% growth, with motor takaful business contributing RM3.07bil to the total and fire takaful bringing in RM840mil.
Motor takaful continues to take up the primary portion of the general takaful portfolio with a 66.2% share, followed by fire takaful at 18.2%.
Perhaps most importantly for consumers and customers of the industry, total benefits payout recorded in 2022 for family takaful claims soared 23.1% to RM5.5bil while claims payout for general takaful amounted to RM2.05bil.
The MTA expects the takaful industry to maintain its growth momentum in 2023, albeit at a moderate rate.
This is in line with Malaysia’s projected economic growth rate, despite the country still being in the post-lockdown recovery phase.
It reiterates the industry’s commitment to providing accessible and affordable takaful protection to all Malaysians, as part of its efforts to support the country’s economic growth and development.
