From left: PIAM CEO Mark Lim, PIAM Convenor, Public Relations/CSR (Country President, Chubb Insurance Malaysia Bhd) Steve Crouch, PIAM Chairman (AIG Malaysia Insurance Bhd) Antony Lee Fook Weng and PIAM Deputy Chairman/Convenor, Finance & Corporate Governance/ERM & Motor (MSIG Insurance (Malaysia) Bhd) Chua Seck Guan at the industry's 2017 results briefing. Photo by: Mohd Suhaimi Mohamed Yusuf
Lim: The industry was affected by drops in MAT and personal accident insurance, as the oil and gas sector remained weak. Photo by: Mohd Suhaimi Mohamed Yusuf
Lee said PIAM expects the industry to see "a little bit of growth in GWP but not a lot". Photo by: Mohd Suhaimi Mohamed Yusuf
KUALA LUMPUR (Feb 9): The local general insurance industry's gross written premium (GWP) stood at RM17.65 billion last year, compared with RM17.67 billion in 2016, despite better performance in the motor insurance and fire insurance segments.
"Last year (2017) was a challenging year for us due to the reflection of the economy. We had a difficult first half but in the second half, we turned better," said the General Insurance Association of Malaysia chairman Anthony Lee Foo Weng during the industry's 2017 results briefing here today.
The association is also known as Persatuan Insurans Am Malaysia (PIAM).
Also present was PIAM chief executive officer Mark Lim, who blamed last year's flat growth on the lacklustre performance of the marine aviation and transit (MAT) insurance and personal accident insurance segments.
"The industry was affected by drops in MAT and personal accident insurance, as the oil and gas sector remained weak," he said.
MAT insurance premiums declined 14.6% to RM1.34 billion, while personal accident insurance premiums registered a drop of 12.6% to RM1.13 billion.
On the other hand, motor insurance premiums grew 1.9% to RM8.32 billion from RM8.16 billion in 2016, maintaining its dominant market share of the general insurance market at 47.1%.
Lim said fire insurance, the second largest segment with a share of 19.3%, posted a 4.2% year-on-year growth to RM3.41 billion.
Meanwhile, total motor insurance claims paid out by the industry last year amounted to RM5.38 billion.
Insurers, said PIAM, paid about RM14.7 million daily for motor claims on property damage, bodily injury and vehicle theft. "Motor insurance claims went up 7% in 2017 from 5% in 2016. This is a very high number," Lim shared.
In terms of financial performance, Lim said general insurance companies saw lower underwriting profit of RM1 billion for 2017, versus RM1.53 billion in 2016.
With the high motor insurance claims, he said the motor insurance class remained in the red last year, widening its losses to a whopping RM356 million from RM37 million a year earlier.
Separately, medical and health insurance recorded higher losses of RM34 million in 2017 against RM17 million in the previous year.
"The motor and medical and health insurance classes have incurred higher losses so it had impacted the financial performance of the industry," he said.
On outlook, PIAM expects flattish 2018 GWP growth in anticipation of a challenging business climate amid uncertainties in the country's economic growth and impending 14th general election (GE14).
Lee said PIAM expects the industry to see "a little bit of growth in GWP but not a lot".
"We would be happy if we get the lowest side of single-digit growth in the range of 0% to 3%. If we get up to 3% growth in GWP, it means we are doing very well but it depends on the upcoming GE14 and economic performance of the country," he said.