The insurance industry of Malaysia registered a second consecutive year of double-digit growth in 2004, supported by robust growth in the life sector. During the year 2004, combined premium income for life and general business increased at a stronger pace of 17.2% (2003: 11.6%) to achieve RM22,038.9 million (2003: RM18,812.3 million). The fundamentals underlying profitability were also stronger, with more disciplined underwriting supporting positive results in the general sector, while further improvements in asset-liability matching were observed in the life sector. Efficiency gains also contributed to improved results.
The insurance market continued to expand in reaching an increasingly important role in supporting economic and social development. Both insurance penetration and density levels have further enhanced. Combined premium income as a percentage of nominal Gross National Product increased to 5.2% (2003: 5.1%), while the market penetration rate was also higher at 37.9% (2003: 36.8%), underscoring its growing importance within the economy in promoting economic activity and individual financial well-being. Total assets of insurance funds expanded by 13.1% to RM86,848.5 million in 2004 (2003: RM76,807 million) mainly contributed by the growth of the life fund assets