by SHAFIQQUL ALIFF / pic by TMR FILE
ALLIANZ Malaysia Bhd foresees weak growth for motor insurance this year owing to low vehicle sales during the Movement Control Order (MCO) period.
Its CEO Zakri Khir (picture) said the extended phase one of MCO under the National Recovery Plan gave a negative impact on the automotive industry for the entire month.
“In June, for example, there has been zero car sales because people are not performing any transactions,” he said during a media roundtable yesterday.
Zakri said the zero sales situation was also due to the global shortage of chip supply affecting many manufacturers.
“Despite the demand, there is no supply of chips for the vehicles,” he said.
It was reported that the local automotive industry is expected to lose RM3.44 billion in June this year alone if there were zero vehicle sales.
Vehicle sales in May 2021 dropped 19% to 46,663 units compared to 57,912 units a month earlier, Malaysia Automotive Association reported recently.
He said the chip shortage also severely impacted the automotive industry that by extension could further impact motor insurance premium growth.
Local car manufacturers expressed concern the global shortage of semiconductor chips will continue to disrupt domestic production for at least the next two to three months, despite the fact sales were brisk due to the Sales and Services Tax exemption.
Allianz’s total general insurance market share stood at 13.3% or RM2.35 billion out of the total industry gross written premium (GWP) of RM17.7 billion, while its motor insurance market share is about 18.6% or RM1.5 billion out of total industry motor GWP of RM8.4 billion.
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