In 2017, insurers and takaful operators issued 1.5 million cheques while 5.7 million were collected from customers. This is a huge number. Cheques are very costly, inefficient and obsolete. If the industry does not respond to these challenges, then others will. Over the past year, the Bank has allowed financial product aggregators to offer insurance and takaful products on a nonadvisory basis under the Regulatory Sandbox. These platforms allow consumers to easily compare and assess product offerings, thus increasing the visibility of insurance and takaful products and supporting our objective of digitalising insurance and takaful distribution. The Bank is close to finalising changes to the regulatory framework that will enable online product aggregators to operate with broad access to the insurance and takaful market by the end of this year. This is a game-changing initiative that will pave the way for a more contestable insurance and takaful market going forward, ultimately improving access and choice for consumers. For the industry, it offers the potential to open up new market segments that were previously untapped, particularly younger millennials, and lower the cost of bringing new products to the market. Third, the takaful industry has to have the right people with the right competence. Strong leadership and quality talent are needed to steer the industry forward to reach greater heights. Let us start from the top with each company’s leadership – shareholders, the board and senior management. For the industry to really break new ground, we need to consider a total reimagination of the takaful model.
The high demand for labour brought unemployment down to 4–5 per cent of trade union membership. In the period from 1917 to 1920 the annual rate of wage increases averaged about 25 per cent. In 1919 and 1920 the balance of trade showed massive deficits of about 5–6 per cent of GDP. Sweden’s inflationary economy elicited mounting criticism. Knut Wicksell, one of our best-known political economists, took an active part in pointing to the grave injustices that rising inflation caused by skewing contracts that had been concluded earlier. Something ought to be done, he said, but no serious efforts to stabilise the economy were actually made. The subsequent adjustment occurred suddenly and unexpectedly. When the international boom came to an end, demand slumped. From 1920 to 1922, manufacturing output in Sweden dropped about 1 40 per cent and GDP about 35 per cent. Unemployment shot up to 25 per cent. The Swedish economy went into a deflationary spiral. The price level fell about 35 per cent from 1920 to 1922. Wages also plummeted; for an industrial worker, for instance, the wage level fell more than 35 per cent in the course of about 18 months. Firms were caught in a vice, squeezed on all sides by steeply falling prices. As always, the firms that suffered most were those with inflated profits, over-valued assets and large misplaced investments. The abrupt plunge into a depression was followed by an equally sudden recovery.