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HSBC Amanah Takaful To Double Contributions

News From : DagangHalal.com (03 May 2010)

HSBC Amanah Takaful (Malaysia) Sdn Bhd said it will continue to optimise its bankataful relationship with HSBC Bank Malaysia Bhd (HSBC Malaysia) to double its contribution of premiums this year.

“We expect to more than double our gross contributions this year,” its executive director and chief executive officer Zainudin Ishak told Business Times.

The Islamic insurer seeks a double-digit growth rate each year in order to reach an internal target of contributing 20 per cent to HSBC Amanah Malaysia Bhd’s revenue by 2011.

Although part of the HSBC group in Malaysia, HSBC Amanah Takaful is 49 per cent owned by HSBC Insurance (Asia Pacific) Holdings Ltd, 31 per cent owned by Jerneh Asia Bhd and 20 per cent owned by the Employees Provident Fund (EPF).

HSBC Amanah is a full-fledged Islamic bank and is a wholly-owned subsidiary of HSBC Malaysia.

“Our strategy is to maximise our bancassurance model, which has already seen new premiums grow more than double in 2009,” Zainuddin said, without disclosing the numbers.

“We are committed to bancassurance. It is the preferred model for HSBC. In fact, HSBC is the biggest banccassurance player in the world,” he added.

Bancassurance is the selling of insurance products by banks through their own distribution channels.

HSBC Amanah Takaful currently has access to HSBC Malaysia’s 40 conventional branches as well as the five branches of HSBC Amanah nationwide.

Bancassurance offers another area of profitability to banks with little or no capital outlay. A small capital outlay in turn means a high return on equity.

In fact, Zainuddin attributed the success of the bancassurance model to the company’s ability of giving surplus profit to its participants since its inception.

“Bancassurance is why our portfolio mix is very profitable,” he added.

The company is also banking on its regular premium products to drive growth this year after its regular premium collections increased by fivefold last year.

“I think in future, the competition among the takaful players is the ability of a company to give returns back to a customer. If we are able to return more, then that itself will explain the beauty and equitable concept of takaful,” he said.

Giving consistent returns is also one of the reasons why HSBC Takaful has been able to attract more non-Muslim customers over the years.

With close to 200,000 HSBC Takaful policy in force last year, more than half of its customers are non-Muslims.

— Business Times

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