Allianz Life still keen on takaful business

KUALA LUMPUR: Allianz Life Insurance Malaysia Bhd, which is aiming tohave 10,000 agents by year-end from 8,300 now, remains interested in the takaful business although it is not in talks with any potential acquisition target now.
Allianz Life CEO Rangam Bir said it sees that a large part of the market has the need for takaful solutions and as a company that believes in delivering the needs of its clients, it also sees the opportunity to offer takaful products.
“We don’t have a takaful business and licence although we have in the past been interested and we continue to be interested in getting a takaful licence whenever the right opportunity is available to us,” he told SunBiz in an interview recently.
Allianz Life is a subsidiary of Allianz Malaysia Bhd, which in turn is Allianz SE’s subsidiary. Allianz SE, Europe’s biggest insurer, had failed in an attempt to buy a local takaful operator in 2011. Last year, a member of the board at Allianz SE told SunBiz that it is not economically viable to enter into the domestic takaful market just yet.
Rangam said Allianz Life it is currently not in talks with any company but will certainly look at such a possibility if the right partner comes along.
“We don’t have a takaful licence but when the timing is right, when we find the right opportunity, certainly we would be interested in getting one.”
Rangam said the central bank is not issuing any new takaful licences at the moment, thus making an acquisition the only way to get into the takaful market.
However, he said Allianz Life has not defined a particular timeline for having a takaful business, as the products that it is offering today are able to meet the requirements of a large segment of the Malaysian population.
“We have a lot of opportunities in terms of reaching out to fulfil the needs of the customers and offer them suitable solutions. Of course, we would like to expand into a new segment (takaful) if possible but, at the moment, we haven’t defined a timeline for ourselves.
“We might not be able to offer precise solutions when it comes to takaful, but many clients also have other product requirements, which they can get from us. From this perspective, we feel comfortable being able to meet most of the clients’ needs,” said Rangam.
Allianz Life makes up 45% of Allianz Malaysia’s total group revenue. The remaining 55% comes from the general insurance arm, Allianz General Insurance Co (Malaysia) Bhd.
In the financial year 2014, Allianz Life recorded gross written premiums of RM1.83 billion and is one of the fastest growing life insurers in Malaysia. It expects a high single-digit growth in gross written premiums in 2015.
“On the life (insurance) side, we’ve been growing from a lower base and have now achieved 45% (of group revenue) but we do see both companies (life and general) being strongly positioned in terms of offerings in the medium term,” Rangam said.
He said Allianz Life has a market share of over 8% and is ranked fifth in the market. Within segments, it is ranked fourth in the investment-linked business, and third in the employee benefits business.
The agency channel, which provides 80% of its sales, is an important part of Allianz Life and Rangam said the company is empowering its agents with digital tools.
“Not many customers today are buying online. Customers research and get information online, but they still want a trusted person whom they can buy (insurance) from. That’s where the role of our agents comes through.
“Our agency channel helps us penetrate new areas of the country where we weren’t present before. By having our agents in Sabah and Sarawak and in new areas and regions, we’re able to reach out to new customers,” said Rangam.
He added that the Allianz Life continues to ensure that it has attractive products that address core customer needs and is coming out with products that are relevant to customers.
“We’re trying to make it affordable and simple for clients to buy insurance.”