MNRB sees little impact from twin tragedies

KUALA LUMPUR: MNRB Holdings Bhd said the two incidents involving Malaysia Airlines' ill-fated flight MH370 and MH17 have only had a small impact on its business.
President and group CEO Mohd Din Merican said generally for the Malaysian market, the impact is small because of the huge high capacity aircraft involved that is mostly reinsured overseas.
He said the impact on its subsidiary, Takaful Ikhlas Bhd was "very little" with only one small claim from a passenger.
For Malaysian Reinsurance Bhd, he said the group had compared it with the industry and the amount is manageable.
"A lot of this business is reinsured out," he told reporters after the group's AGM here yesterday.
MNRB derives 90% of its profit from its reinsurance business and 10% from its takaful business.
Malaysian Re is the market leader for the domestic reinsurance business with a market share of 53.5%. About 62% of its customers (insurance companies) are domestic and 38% are overseas.
Din expects market liberalisation to increase competition in the market and MNRB will continue to invest in talent, tools and sophistication (system) with the hope of retaining its market leader position. It also wants to ensure that the group has sufficient capital and a strong financial standing.
"We continuously review what we write, where we write and that's part of our prudence to ensure we are here for the long term," he said.
The company remains cautiously optimistic of the group's prospects for FY15 in view of the unpredictable nature of events.
"It is difficult to estimate what will happen, especially with the hurricane and typhoon season now, but it should remain stable."
He added that the impending implementation of the goods and services tax (GST) will also see minimal impact to the group, adding that MNRB is on target to meet the GST.
"We may need to reprice some of our products but the impact won't be much," he said, explaining that this does not necessarily mean a price increase, as it depends on whether such costs can be covered operationally.