Potential Careers in Insurance in Malaysia

Careersin

Insurance in

Malaysia

POTENTIAL CAREERS IN INSURANCE IN MALAYSIA

With the growth of the financial sector anticipated to be between 8-11%

annually leading to an increased contribution of the financial sector to about

10-12% of nominal GDP in 2020 (2010: 8.6%), and given the envisioned

transformation of the financial sector, there will be an even greater demand

for high-quality talent by the financial sector, or the insurance industry in

particular.

In 2012, the Malaysian insurance industry had about 141, 231 workforce in

all areas of the business. With several rapid developments taking place

today, we have to anticipate a double - figure increase of the talent pool in

the next 3 to 5 years to come.

Marketing• Marketing involves looking into the insurance

needs of clients for which market research may have to be done from time to time.

• A marketing officer may also have to supervise and motivate the agency force of the insurance company. He or she will be required to provide them assistance, guidance and training and ensure that they achieve their business targets, and provide efficient after-sales services to the clients.

• Personnel in this department must understand and have an affinity to meeting and satisfying the demands of the customers.

Insurance Agent• To act on behalf of an insurance company to acquire insurance

business from the customers or prospective customers of the insurance company. Unlike the insurance broker who represents the buyer of insurance, the insurance agents represent the insurance company essentially to sell insurance policies.

• Insurance agents can act on behalf of not more than two general insurance companies and one life insurance company at a time.

• To be a general insurance agent, one must sit for and pass the Pre-Contract Examination For Insurance Agents (PCEIA) , Part A & Part B, and to be a life insurance agent, one must pass Part A & Part C of the PCEIA. The examination is conducted by The Malaysian Insurance Institute (MII).

Insurance Agent• After passing these examinations, the general agent will have to register

himself/herself with the Persatuan Insurans Am Malaysia (PIAM), and the life agent with Life Association of Malaysia (LIAM) before he can transact any insurance business.

• An Insurance agency can be operated either on a part-time basis or on a full-time basis. However, in today's very competitive environment, more and more agents have become professionals who operate their agency business on a full time basis. Traditionally, insurance agents are paid by the insurance companies they work for by way of commissions on sales.

Underwriter

• To assess the risks involved in the insurance proposals made to the company and decide whether to accept or reject the proposal.

• If the underwriter decides to accept the proposal, he also decides on the terms and conditions of the insurance contract depending on the degree of the risk. He may decide to pass on a part of the risk to another insurer (reinsurance).

Underwriter• An underwriter must have a multitude of skills and

knowledge in order to understand the risks before he can decide on how to insure the risks.

• There are also many specialist underwriters who are experts in certain fields and classes of insurance only e.g. in insurance of space-crafts, aviation or oil and gas platforms, etc. This is because some risks are so large and complex that only specialist underwriters have mastered the job.

Investment• After collecting the premiums, the

insurers make use of the premiums to make payments towards commissions, administrative expenses and claims but there is a difference in time between receipt of the premiums and payments to be made.

• During this time lag the insurers are in possession of large sums which they invest carefully keeping in view the security of the investment as well as the income on their investments.

Investment• The investment department's personnel have to use their expertise to achieve a

balance between secure investment and high returns. The investment manager also has to ensure that the company is financially strong so that the company is able to settle all claims. The investments are spread out in government securities, shares and debentures of companies, fixed deposits with banks and finance companies, investment in land and buildings, etc.

• There are times when the insurers may not make much profit from the underwriting (i.e. the surplus of premiums over commissions, administrative expenses and claims).

• Sometimes they may even suffer underwriting loss. But they may earn enough income from investment which may outweigh the loss suffered in underwriting. Therefore, investment by an insurance company is of considerable importance.

Claims• A claims personnel's job is to process and settle the claims made on the insurance

company under insurance contracts. Before settling the claims, he ensures that : a) the loss has taken placeb) the loss is covered under the terms of

the insurance policy

• To do this, he needs enough knowledge and evidence of the causes that led to the loss and the extent of the loss. In view that the world today is so complex and the types of insurable losses so numerous, the need for skilled and knowledgeable people with integrity and professionalism has become a vital part of any claims department.

Actuary• An professional who uses mathematical skills to create and manage

programmes which reduce the financial loss due to the expected and unexpected events that happen to people, like illnesses, accidents, unemployment, or early death.

• Helps design plans and evaluates the financial risks a company takes when it sells an insurance policy or offers a pension programme.

Actuary• Actuaries have many responsibilities.

• First, an actuary must make sure that there is enough cash on hand to pay benefits when people make claims on their insurance policies or draw income from their pension plans.

• Secondly, the actuary must also see to it that the price charged (premium) to participants of an insurance or pension plan is fair.

• Actuaries are often found in highly responsible management positions and frequently work as vice-presidents and presidents of insurance companies or as senior partners on actuarial consulting firms.

Broker• Full-time professional intermediaries whose job is to place the

insurance business of their clients (corporate clients) with any of the insurance companies.

• They are expected to know the various insurance coverage and rates of premium offered by the insurance companies.

• They represent their clients who want to buy insurance coverage.

• The brokers have to study the insurance needs of their clients and place their insurance after negotiating terms with the appropriate insurers.

Broker• They also help their clients in presenting claims to the insurance

companies and in getting their claims settled.

• The brokers are paid a brokerage by the insurance companies.

• Insurance brokers require a license from the insurance regulator and a professional indemnity policy before they can commence business.

Loss Adjuster• Loss adjusters/assessors are independent professionals who are

appointed by the insurance companies to survey a loss due to fire, motor accident, etc.

• Their job is to investigate the causes of the loss and determine the extent of loss and report their findings to the insurance company.

• Based on their reports, the claims are settled.

• They are paid by way of fees by the insurers.

Loss Adjuster

• They need to possess not only knowledge of insurance coverage but also know-how different kinds of losses take place and be able to determine the extent of loss or damage.

• They also advise on loss prevention/minimization measures in the light of their experiences.

• Loss adjusters require a license from the insurance regulator.

For more information, please visit:

General Insurance : Persatuan Insurans Am Malaysia (PIAM)www.piam.org.my

Life Insurance: Life Insurance Association of Malaysia (LIAM)www.liam.org.my

Broking: The Malaysian Insurance and Takaful Brokers Association (MITBA)www.mitba.org.my

Loss Adjusting: Association of Malaysian Loss Adjusters (AMLA)03 9281 6615/6617

Education: The Malaysian Insurance Institute (MII)www.insurance.com.my