By BERNAMA / Pic By MUHD AMIN NAHARUL

Foreign insurers, who have repatriated about RM16.5 billion between 2008 and 2017 in the form of dividends but didn’t contribute as much as expected for the development of the domestic industry, can’t choose alternative initiatives with their promise to divest stake, said Bank Negara Malaysia (BNM).

The contributions of the foreign insurers to the overall development of the domestic insurance industry despite a long presence in Malaysia, have not been at the level expected.

For example, there has been minimal improvement in insurance penetration, compounded by the lack of breadth in products (especially for lower-income segments) and concentration of high-cost distribution models, BNM said in a statement yesterday.

“The bank welcomes any initiative by insurers that would benefit the Malaysian economy and the general public, as expected of any ordinary responsible corporate citizen that operates in the country,” it said in a reply to report that foreign insurance companies would set up healthcare trust as an alternative to fulfilling their commitment to pare down their shareholding by 30% before the June 30 deadline.

BNM also noted that the bank had not received such a proposal.

The central bank stressed that the agreed foreign shareholding level was a commitment provided by the foreign shareholders in being granted a licence to operate in the country.

The foreign insurers were given the licence to operate in the domestic market on the basis of the specific commitments and assurances given. — Bernama