In this sector, there remains significant untapped demand for general insurance products as a whole. The low penetration rate of 1.4% for general insurance, which is measured in terms of premiums as a share of the nation’s Gross Domestic Product, is actually symptomatic of this. Thus, agents who move quickly to improve their digital outreach will have a first mover’s advantage and are likely to gain a growing group of digitally literate Malaysians. Thirdly, conducting robust suitability assessment for customers. One thing worth emphasising repeatedly is this; financial services offered must be suitable to the needs of the customers. While the Bank’s Guidelines on Product Transparency and Disclosure attempts this by stipulating the ‘rules of the game’, we look to insurers and the agency force to ‘play’ according to these rules and seek out ways to achieve the outcome of ensuring consumers obtain financial services that are suitable to their needs. Agents should develop their individual capacity to analyse customer requirements to identify their needs and develop risk profiles to match them with suitable products or combinations of products. For example in the case of motor insurance policies, agents should create awareness on optional add-on covers that are available and underwriting factors that will affect motor insurance premiums. Appropriate profiling of a customer can be crucial in helping agents identify customised product recommendations efficiently. Finally, perhaps I should bring your attention to two upcoming developments.
Firstly, we understand that the industry is in the midst of finalising a recent independently-conducted Customer Satisfaction Index (CSI) that will be a means to gauge the insurers’ performance against the enhanced insurance industry’s Customer Service Charter which was introduced in January 2018. This survey includes minimum service standards that reflect the guiding principles for good customer service. The results of the CSI survey is expected to be finalised by end-2018. I would urge you to familiarize yourself with the Customer Service Charter of your principal insurers and use it to guide you in your dealings with customers so as to ensure good customer experience. Secondly, the Bank is at a fairly advanced stage of finalising the policy document on fair treatment of financial consumers. This will address the Bank’s increased expectations on financial institutions, including insurers, to cultivate a culture of fair dealing and responsible behaviour. The onus will be on insurers to ensure agents observe new standards to exercise due care, skill and diligence in dealing with financial consumers. We should expect principal insurers to accord greater emphasis on the importance of (1) providing clear and concise product information to customers to enable them to make informed choices, (2) offering products that are appropriate to the customers’ needs and financial circumstances, and (3) providing individualised advice that is in the best interest of the consumer. Let me conclude.