Survey Unveils Positive Trends In Malaysia’s Takaful And Insurance Industry

The findings of the Customer Satisfaction Survey 2022 (CSS 2022) shows encouraging trends in Malaysia's Takaful and Insurance industry.

The Malaysian Takaful Association (MTA), Life Insurance Association of Malaysia (LIAM), and Persatuan Insurans Am Malaysia (PIAM), in collaboration with Bank Negara Malaysia (BNM), have released the findings of the Customer Satisfaction Survey 2022 (CSS 2022). Overall, the survey has shown encouraging trends in the industry, with a notable increase in the Customer Satisfaction Index (CSI) score rising from 80 points in 2018 to 85 points in 2022.

Prior to this, the takaful and insurance industry introduced the Customer Service Charter (CSC) in 2011 to enhance transparency on the commitments of insurers and takaful operators to providing efficient and high quality customer services to their customers. The Charter underwent further revisions on 1st January 2018, focusing on 4 pillars which are: (1) Insurance/Takaful Made Accessible through Better Engagement and Improved Services, (2) Knowing the Customer to Build Trust, (3) Timely, Transparent and Excellent Service to the Customer’s Satisfaction and (4) Fair, Timely and Transparent Claims Settlement Process to provide Peace of Mind.

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The survey, conducted by NielsenIQ Malaysia, aimed to measure customer experiences and assess the impact of the pandemic on the quality of customer services offered by the insurance and takaful industry . The CSS 2022 had several objectives, including evaluating customer engagement, service delivery in accordance with the Customer Service Charter (CSC), trust levels between customers and the industry, and customer satisfaction with products and services purchased. A total of 10,206 customers participated in the survey, involving 48 ITOs.

Key findings from the survey include:

  1. Improved Customer Satisfaction: Despite the challenges posed by the pandemic, the survey has uncovered encouraging trends, across all sectors, i.e. life insurance, general insurance, and takaful, with a notable increase in the Customer Service Index (CSI) score rising from 80 points in 2018 to 85 points in 2022.
    Satisfaction improved across all pillars namely Accessibility (+15 points to 79), Product suitability (+9 points to 79), Service Efficiency (+8 points to 79) and Claims transparency (+7 points to 75). The significant improvement in the accessibility pillar is a notable achievement for the industry as customers are now finding it easier to reach out to their insurance and takaful providers, accessing information, enquiring, and purchasing through various touchpoints. Ease of online access has significantly improved as the pandemic had accelerated the investment in digital channels and consumer adoption of digital channels.
    Industry performance also improved across all CSC outcomes in the areas of Responsiveness (+12 points to 84), Trustworthiness (+3 points to 78), Satisfaction (+11 points to 76) and Peace of mind (+5 points to 82).
  2. Voice of Customers: 74% of customers expressed a positive sentiment regarding their insurance and takaful experience. Notwithstanding, some customers continued to experience inefficiencies in claims processes and poor responses from some operators when reaching out for assistance. The takaful and insurance industry will strive to enhance customers’ claims experience further by reducing waiting time for claims payment, making customers aware of the time taken for claims settlement and by providing periodical updates on status of submitted claims.
  3. Net Promoter Score (NPS): The NPS of the insurance and takaful industry significantly improved, increasing from -4 points in 2018 to +20 points in 2022. NPS measures the loyalty of customers to a company. Younger customers, women, customers residing in Northern region, and those in the middle-income group (M40) displayed higher NPS scores. The higher NPS and positive word of mouth is an opportunity for the industry to bring more people (uninsured and underinsured) into the takaful and insurance ecosystem. The industry will continue to motivate customers to actively recommend or share their positive experience with others.
  4. Top Performing Operators: The top five (5) performing operators* across the whole takaful and insurance industry based on CSI scores, arranged in alphabetical order are:- Allianz General Insurance Company (Malaysia) Berhad, Allianz Life Insurance Malaysia Berhad, FWD Insurance Berhad, Prudential BSN Takaful Berhad, and Zurich Takaful Malaysia Berhad.

(*Note: * Names of the top 5 operators are arranged in alphabetical order)

Among the contributing factors to the overall improvement of customer satisfaction for Malaysia’s takaful and insurance industry would be the various relief measures conducted by the takaful and insurance companies for the public, such as the COVID-19 Test Fund, which was a joint Corporate Social Responsibility (CSR) initiative by LIAM, PIAM, and MTA to subsidise the cost of COVID-19 tests for medical health policy and certificate holders. All three (3) associations jointly contributed a total of RM10 million for the initiative.

The survey findings also revealed the need to enhance awareness on the Customer Service Charter (CSC) among customers, as awareness levels have declined. The study identified key drivers of customer satisfaction, including secure handling of personal data and privacy, knowledgeable staff, timely service at call centers, and ease of obtaining quotes.

Based on the survey findings, the industry has identified several action plans, including raising awareness of the CSC, improving initial interactions with customers, re-designing the role of agents, investing in key satisfaction drivers, improving the claims settlement process and investing in digital solutions to meet evolving customer preferences.

The CSS 2022 also provides valuable insights for the insurance and takaful industry s to optimize the agency channel to ensure high levels of customer satisfaction throughout the customer journey and experience. Going forward, the industry will focus on advancing innovations and technology to provide best-in-class experience for Malaysian customers.

For further details on the findings of the CSS 2022 can be found on the MTA, LIAM and PIAM websites as set out below:-