ANALYSIS OF THE DEMAND FOR LIFE INSURANCE AND FAMILY TAKAFUL

Abstract The Malaysian insurance and takaful industry has enjoyed encouraging growth in the last decade despite the global economic crisis. This paper aims to investigate the driving force of the life insurance and family takaful consumption in Malaysia, using annual time series data covering the period from 1970 to 2008. To investigate the long-run relationship and short-run dynamics of the theorized variables on the demand for life insurance and family takaful, the autoregressive distributed lag (ARDL) bounds testing are employed. Computation of the F-statistic for testing the significance of the lagged levels of the variables in the error correction format of the underlying ARDL model confirmed the existence of cointegation between the variables under study. The estimations of the coefficients of the long-run relations and of the error correction model find that income, education level, and EPF are among significant predictors of the life insurance and family takaful consumption

Underinsurance in Malaysia: the application of the Monte Carlo simulation

This study seeks to estimate the extent of underinsurance among Malaysian families in 2012. Underinsurance is quantified by the extent to which the citizens in a country are inadequately covered by the life insurance protection. To measure underinsurance, we use the concept of the life insurance protection gap as proposed by Swiss Re (2004). The mortality protection gap is the difference between the resources needed and the resources available. The resources needed refer to the resources the surviving dependents require for income replacement, debt repayment and other major expenses. The resources available refer to those resources actually available to the dependents from financial assets, social security and life insurance coverage. The data collected are simulated using the Monte Carlo simulation process. Statistical analysis of the results of the simulation runs indicates that, on average, the extent of underinsurance in Malaysia is about RM500,000 per household

Mengaplikasi struktur pengagihan risiko dalam program kokurikulum universiti

Pengurusan risiko adalah sangat penting dalam memastikan program kokurikulum di universiti mencapai peranannya iaitu sebagai pelengkap kepada kurikulum akademik dalam melahirkan graduan yang seimbang dalam aspek jasmani, emosi, rohani dan intelek. Kajian ini melihat bagaimana pengaplikasian kaedah Struktur Pengagihan Risiko (SPR) iaitu satu kaedah yang mengenalpasti, menaraf dan menentukan faktor risiko bagi program kokurikulum di institusi pengajian tinggi khususnya di UKM. Ianya dilakukan melalui dua peringkat yang bermula dengan menstrukturkan risiko program berdasarkan SPR seterusnya menaraf atau mengkelaskan tahap risiko terbabit. Hasil kajian mendapati bahawa SPR bagi program kokurikulum di UKM boleh dibahagikan kepada dua peringkat iaitu pertama: sumber risiko bagi program tersebut boleh dilihat berdasarkan fasa-fasa kitaran hayat program tersebut. Terdapat 9 sumber risiko yang telah dikenalpasti iaitu perancangan, rekabentuk, maklumbalas, lokasi, tenaga kerja, kewangan, pengurusan, faktor luar kawal dan kebolehlaksanaan program. Seterusnya, peringkat kedua merujuk kepada risiko yang lebih terperinci yang berpunca daripada setiap sumber risiko dalam peringkat pertama. Secara keseluruhan, terdapat 41 jenis risiko program yang telah dikenalpasti di peringkat kedua. 17 daripada risiko ini dikategorikan sebagai kritikal yang kebanyakannya meliputi aspek kewangan, manakala 24 risiko berada pada tahap sederhana kritikal yang banyak melibatkan fasa projek and fasa maklumbalas. Implikasinya semua risiko yang berada pada tahap kritikal merupakan risiko yang perlu diberi perhatian yang lebih berbanding risiko lain kerana pengabaian terhadapnya boleh menyebabkan kegagalan projek yang serius. Dari segi keutamaan risiko pula, kajian ini mendapati bahawa risiko yang berkaitan dengan kewangan merupakan risiko yang perlu diberikan perhatian utama dalam memastikan kejayaan program kokurikulum di UKM. Sebaliknya, risiko cuaca, risiko bencana alam dan risiko alam sekitar merupakan antara risiko yang kurang penting. Walau bagaimanapun, pengabaian risiko-risiko ini secara total mampu menjejaskan kelancaran program yang dilaksanakan. Faedah yang diperolehi hasil daripada pengaplikasian SPR ini ialah ia akan menjadi senarai semak kepada pelajar tentang risiko yang bakal dihadapi oleh mereka sepanjang melaksanakan program kokurikulum. Di samping itu, dengan bantuan SPR, para pelajar boleh bersedia dengan pelan-pelan alternatif bagi meminimumkan kesan akibat daripada risiko tertentu dan sekaligus meningkatkan peluang kejayaan program yang dilakukan dari segi skop, jadual dan belanjawan

Takaful claim dilemma

“What a long and tedious meeting!” Borhan was heard grumbling.He had just finished attending July monthly meeting with the top management of Takaful Dinamik Berhad (TDB), a takaful company located in the heart of Kuala Lumpur.Just as he was about to breathe a sigh of relief, Borhan saw a letter which was discreetly placed on his table by his secretary.He was about to throw his files onto the letter when his eyes caught the phrase "Bank Negara Malaysia” (BNM) on the letter.BNM is the Central Bank of Malaysia and responsible for regulating and monitoring the insurance and takaful industry in the country. Borhan felt a bit anxious. With a furrowed brow he opened the letter and scrutinized the content line by line

Modeling premium growth in the Malaysian Motor Insurance Industry

The motor insurance industry came into the limelight since the enforcement of mandatory motor insurance coverage in 1959 This paper uses a modeling technique to ascertain the various components and parameters that affect the change in premiums receIved by the entire industry, or a segment of it. Once these components & parameters are identified, the actual growth of new premiums can be derived by extrapolating the components and parameters in one or more expressions (or commonly referred to as a formula). These expressions could be useful in forecasting the future market dynamics of the motor Insurance Industry

Selection criteria of motor insurance consumption

In Malaysia, motorists are required by law to insure minimum coverage for their automobiles. However, the policy they own and the insurer they choose may not suit their needs. This study examines several characteristics which influence consumers’ selection of auto insurance policy and their loyalty to one insurer. Data were collected from a survey of 178 randomly selected respondents. A chi-square analysis was conducted to determine the relationship between age, race, gender, education background and automobiles’ market value to the selection of auto insurance policy. In addition, the relationship between premium, dividend, insurer’s internal factors, claim services and non-claim services to the loyalty of the consumer are also tested using the chi-square and Spearman rank test. The results indicate that education background and market value of the automobile are significant characteristics in selecting auto insurance policy, while premium, dividend, insurer internal factors, claim and non-claim services are not related to the loyalty of the consumer. The study reveals that such results were attributed to the lack of industry information and the role of auto salesperson. For future research, the issue should be examined with a larger set of data to represent the industry bette

Pengaruh literasi kewangan terhadap pengurusan kewangan mahasiswa

Perbelanjaan pendidikan dan harga barang yang semakin meningkat menyebabkan mahasiswa memerlukan literasi kewangan untuk membantu mereka menguruskan kewangan dengan baik supaya dapat menyelesaikan masalah kewangan yang dihadapi dalam kehidupan mereka. Oleh itu, kajian bertujuan untuk mengenal pasti pengaruh literasi kewangan kepada pengurusan kewangan mahasiswa. Sampel kajian ini terdiri daripada 100 orang responden yang dipilih berdasarkan kaedah persampelan mudah. Hasil kajian menunjukkan bahawa secara purata mahasiswa mempunyai tahap literasi kewangan dan tahap pengurusan kewangan yang tinggi. Hasil regresi linear mudah menunjukkan bahawa item dalam literasi kewangan iaitu pengetahuan kewangan, tingkah laku pengurusan kewangan dan pengalaman kewangan mempengaruhi item pengurusan kewangan mahasiswa iaitu perbelanjaan, pelaburan dan simpanan. Hasil kajian memberi input kepada pihak yang berkenaan untuk melaksanakan progam atau usaha bagi meningkatkan kesedaran mengenai literasi kewangan dalam kalangan mahasiswa. Kursus Pengurusan Kewangan perlu diwajibkan kepada setiap mahasiswa bagi menyediakan mereka dengan pengetahuan kewangan secukupnya sebelum menempuh dunia sebenar apabila bergraduasi kelak