HSBC Amanah Takaful keen to maximise bancassurance ties

By Alfean Hardy
HSBC Amanah Takaful (Malaysia) Sdn Bhd is looking to maximise its bancassurance relationship with HSBC Bank Malaysia Bhd (HSBC Malaysia) in order to reach an internal target of contributing 20% to HSBC Amanah Malaysia Bhd's revenue by 2011, its executive director and chief executive officer Zainudin Ishak said.
Although part of the HSBC group in Malaysia, HSBC Amanah Takaful is 49% owned by HSBC Insurance (Asia Pacific) Holdings Ltd, 31% owned by Jerneh Asia Bhd and 20% owned by the Employees Provident Fund (EPF).
HSBC Amanah is a fully fledged Islamic bank and is a wholly owned subsidiary of HSBC Malaysia.
At a media briefing in Kuala Lumpur yesterday [May 19, 2009], Zainudin said the strategy going forward was to maximise its bancassurance model, which had already seen new premiums grow from RM15 million to RM30 million over the past six months.
"We need to do it well and unleash the full potential partnership with HSBC Malaysia and this will be our theme over the next three years," he added.
HSBC Amanah Takaful currently had access to HSBC Malaysia's 40 conventional branches as well as the four branches of HSBC Amanah nationwide.
Asked whether HSBC Amanah Takaful would take advantage of the recent liberalisation in the financial and insurance sectors and open branches of its own, Zainudin said there was no need.
"If you look at the bancassurance model, there's no real need for us to have a presence of our own independently," he said.
"We should leverage on the whole might of HSBC Malaysia without duplicating as it would involve costs to set up a branch.
The success of bancassurance is when you intertwine our product and the bank's products, which is our direction going forward," he added. To a question about having bancassurance distribution agreements with other parties aside from HSBC Malaysia, Zainudin said HSBC Amanah Takaful was open to opportunities but it was not a priority for the Islamic insurer.
"It's important for us, as a startup, to maximise our bancassurance potential with HSBC Malaysia and we don't want to distract our focus by getting into other forms of relationship at the moment. But if the need is there or if opportunities arise, we will do a proper evaluation on that," he added.

(This story appeared in The Malaysian Reserve on May 20, 2009. The Malaysian Reserve is a daily business/finance newspaper published out of Kuala Lumpur, with a sectoral page on Islamic finance on Mondays, edited by Habhajan Singh)