KUALA LUMPUR: The Malaysian Takaful Association (MTA) aims to double takaful penetration to 40 per cent in four years from the current 20 per cent under the Hijrah 2027 Strategic Plan.
Chief executive officer Mohd Radzuan Mohamed said takaful penetration rate is at 20 per cent while conventional stood at 34 per cent.
This means that 46 per cent of Malaysians are still not protected, Mohd Radzuan said at media briefing on the unveiling of Takaful Financial Sector Blueprint (FSB) interim report here today.
"We think there is a niche market for takaful which mainly includes those in the bottom 40 income group and the lower middle 40 income group such as young parents and gig workers who are not financially protected.
"We feel takaful has a good proposition for these groups because although our strategies are focused on making takaful more profitable, we also want to contribute back to the community to ensure the financial gap is close.
"A lot of our planning is about financial literacy and enhancing awareness," he added.
The interim report on the Takaful FSB 2023 highlighted the progress made towards sustainable growth for the industry.
It delves deep into the achievements obtakaful operators, examining key project milestones and intended outcomes against the backdrop of the value-based intermediation for takaful (VBIT) and its maturity continuum.
The VBIT Framework was issued by the takaful industry in 2021, followed by the VBIT Roadmap in 2022.
The Takaful FSB is currently in the implementation phase, and the working groups are making substantial progress in all strategic thrusts through the eleven working groups that oversee various aspects of financial inclusion, evonomic resilience, digitalisation, sustainability and climate resilience and Islamic finance leadership.
"We expect the adoption of VBI agenda will drive the industry towards a sustainable finance ecosystem.
"The Takaful FSB will continue to be instrumental in driving the industry forward and will continue to do so," added Mohd Radzuan.
The Takaful FSB is a comprehensive initiative by the MTA, aimed at aligning and harmonising Bak Negara Malayia's FSB 2022-2026 targets and VBIT roadmap.
It focuses on ensuring the sustainability, stability and continued growth of the takaful industry.
The full report will be available in the first quarter of 2025.