Over the years, Bank Negara Malaysia working together with the insurance associations has invested significantly in informing the public about insurance through our financial literacy initiatives. We have come a long way in this process. Today, schoolchildren as young as 10 years of age will already be introduced to insurance through subjects taught in the formal school curriculum. By 2021, we expect to complete the process of integrating financial education content in the formal school curriculum at all levels of primary and secondary education. We have also continued to expand the ways in which we reach consumers, through different mediums and leveraging in particular on social media. We have adopted a life cycle approach to guide education initiatives, so that education content is more targeted and delivered when consumers are most responsive to receiving information. And we continue to adapt our education content so that it remains relevant and current to the issues and experiences that consumers face. In parallel with these efforts, agents will have a more important role going forward. With greater proliferation of online avenues for consumers to obtain information, contacts between agents and consumers are likely to be more targeted and specific in nature. Consumer needs and appetite for advice will also be greater in a more diverse insurance landscape.
It will improve incentives for safe driving behaviours and better risk management practices by both risk owners and insurers. And it will address market distortions which have threatened access to motor insurance, particularly for higher risks. This is also a time when businesses and households are facing rising costs and more uncertain conditions which can adversely affect discretionary spending on insurance. At the same time, the exposures of households and businesses which insurance is designed to protect, have actually increased as evidenced by more frequent and severe incidents of natural and man-made disasters. All of these developments raise critical questions for insurance agents. One question that comes up time and again is: Will insurance agents continue to be relevant? If you are in this room today, then I assume you will agree with me that the answer is clearly ‘yes’. But I believe you are also here because there is a recognition that agents will have to evolve. Even if some of you were not completely convinced of this before, that reality surely can no longer be ignored or dismissed. So the more important question then is how agents can be a meaningful part of this change in order to advance the important benefits of insurance for the economy and the wider society? Today in Malaysia, the general insurance penetration level measured in terms of premiums as a share of GDP stands at less than 2% (1.68% as at end 2015).