Malaysia: Regulator starts consultation on bancassurance
Source: Asia Insurance Review | Oct 2021
Bank Negara Malaysia (BNM), Malaysia’s central bank, has issued an exposure draft setting out proposed requirements with respect to bancassurance /bancatakaful arrangements, while facilitating the sustainable development of the channel as an avenue for needs-based sales of insurance and takaful products in Malaysia.
The draft covers bancassurance/bancatakaful arrangements, governance, oversight, accountability, management and control, transparency and disclosures, training and reporting.
The tendency to focus more on the short-term returns, while not fully understanding the longer-term downside risks associated with more complex insurance products, are among the key challenges faced by consumers. To mitigate this, transparency and disclosure requirements have been enhanced to help consumers make more informed financial decisions when considering the purchase of such products through bancassurance/bancatakaful channels.
The policy requirements in this exposure draft will be applicable to existing and new bancassurance/bancatakaful arrangements, including renewal of agreements. A