kuala lumpur: The Malaysian Takāful Association (MTA) expects Digital Insurers and Takāful Operators (DITO) to boost the country’s Takāful penetration from 18.6% in 2021 to 30% by 2027.
Its CEO, Mohd Radzuan Mohamed, said DITO will bring significant digital transformation to both insurance and takaful segments, ultimately meeting the overall target rate of 75% set by the government. said to help the country achieve.
“We all know that insurance and takaful operators offer a wide variety of products and services, so we hope DITO can add some figures to the target rate.
“DITO can help operators reach untapped territory to introduce their products to people,” he told media after the Malaysian DITO Conference 2023 held here today.
Meanwhile, Yee Wing Peng, CEO of Deloitte Malaysia, said that the introduction of the DITO framework will help insurance and takaful insurance and takaful businesses through innovative product design, risk-responsive underwriting practices, more efficient claims management processes and seamless services. He said that the digital transformation of the sector can be achieved. to consumers.
Citing data from Bank Negara Malaysia (BNM), Mr Yee said only 25% of workers in the bottom 40% of household income groups (B40) had some form of life insurance or family takaful insurance. and said this was significantly lower than 59%. Percentage of adult workers in the general population who are covered by takaful or insurance.
He said Malaysia’s insurance penetration rate, based on insurance premiums as a percentage of gross domestic product, is currently at 4.7%, below the global average of 7.2%.
“DITO can play an important role in closing the protection gap, especially within B40 households,” he said.
Most Malaysians are aware that insurance and takaful provide financial protection against uncertainty and unforeseen circumstances, he added.
Mr Yee said that in the long run, this would contribute to reducing poverty and improving social and economic conditions, propelling Malaysia towards a digitally-driven, high-income developed country.
“In this regard, we expect DITO (license) applicants to seek to demonstrate meaningful value propositions that contribute to long-term social and economic benefits,” he said.
Introduced by BNM in November 2022, DITO’s licensing and regulatory framework aims to reach underserved and underserved markets through the adoption of advanced digital technologies and innovative business models. It aims to facilitate the entry of DITOs with a strong value proposition to serve, offer competitive products and enhance the consumer experience. . – Bernama