The life agency force has grown to about 80,000, with more of them earning higher average incomes as they pursue professional careers as full time insurance agents. The industry is on a strong financial footing with excess capital of RM23.5 billion, above the regulatory minimum capital requirement. Expense rates have declined from 41%, prior to the introduction of the Guidelines to Control Operating Cost of Life Insurance Business, to 26.3% in 2013, representing significant efficiency gains that have created a more competitive industry and improved value for policyholders. Most importantly, the life insurance industry has continued to innovate through new products and distribution channels, providing individuals protection against financial risks and help them meet their financial goals, whether for education, retirement, or to pay for medical expenses. In 2013, the industry paid out over RM16 billion in benefit claims to policyholders under various life insurance policies. The life insurance has contributed to the betterment of the health and Malaysian in general. The life insurance industry has also had a key role in the development of Malaysia’s capital market. At 104.5% of GDP, our bond market is the largest in South East Asia, and fourth in Asia after Japan, China and Korea. More than RM150 billion is invested by the life insurance industry in the bond market which provides an important source of long term funding that is critical for the development needs of the economy, in particular in financing long term infrastructure project.
LIAM has been an advocate of important issues that concerned the industry and has served as the primary interface between the industry and the Government, the Bank, and other key stakeholders. In this capacity, one of its key 2  BIS central bankers’ speeches  roles is shaping public opinion by providing accurate information on the industry. It is also an important agent of change for the better of the entire industry – not just in the short term or with a bias towards any particular stakeholder group. Not too long ago, a media publication reported that life insurance agents are being marginalized and the majority of them earn very low commissions due to restrictive remuneration structures. What the report failed to highlight however, was that such agents were mostly part-timers generating only one policy per month. The report also does not discuss many structural issues confronting the industry; the fact that demand for life insurance in Malaysia remains much lower than in our more developed Asian neighbours. Or that Malaysia’s per capita spending on life insurance of USD330 is lower than the world average of USD373, or seven to 12 times lower than the amount spent in Singapore, Japan and Hong Kong. Also lost was the fact that, the world is experiencing demographic, lifestyle and environmental changes that have profound implications for mortality and morbidity rates. Life threatening diseases that were benign 40 years ago are common causes of early death today due to less healthy lifestyles and greater mobility of labour.