Full Annual Report 2005 - MAA Group

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Chairman’s Statement (continued)eleven (11) kidney dialysis centres to cater for the needs ofthe ever-increasing number of new patients for suchsubsidized medical services.ATMs located at branches nationwide for greater customerconvenience.Mesin ATM yang terdapat di cawangan-cawangan seluruhnegara untuk kemudahan pelanggan.The Group has also adopted The Budimas CharitableFoundation (the Foundation) in 2002 with the objective ofproviding welfare to the under-privileged children and thepoor. Towards this end, the Foundation has adopted fivehomes for under-privileged children and orphans, wherefinancial support continuously for an initial period of fiveyears from year 2002 to 2007 shall be given.The Group will continue to allocate resources to furtherthe objectives of these charitable activities in the years ahead.PROSPECTSBank Negara Malaysia reported in its Annual Report 2005that the Malaysian economy in 2006 is expected tostrengthen further albeit the environment of a morefavourable global conditions. With real GDP projected togrow at a faster rate of 6%, driven by strengtheningexport performance and resilient domestic demand,coupled with the Government launching the NinthMalaysia Plan which sets out the foundation for furtherdevelopment and strengthening the prospects for theMalaysian economy, the Malaysian insurance industry ispoised to register favourable growth in the years ahead.The Group is well aware of the many challenges aheadand the increasing competitive environment it is facing.Towards this end, the Group will continue its initiative toinvest in the latest technologies to further enhanceoperations efficiency, strengthening distribution system,human resource and agency development anddeveloping innovative products to improve further thequality of services to customers.31Lastly, the Group is optimistic of achieving better results inthe years ahead through the various strategies undertakento position itself as an integrated financial services group.ACKNOWLEDGEMENT AND APPRECIATIONOn behalf of the Board of Directors, I would like to thankthe management team and staff for their continuedcommitment, dedication and contributions to ensure thecontinued growth and success of the Group.I would also like to take this opportunity to extend ourappreciation to the regulatory bodies for their continuedguidance and support; to our valued customers, agents,business associates and the shareholders for theirinvaluable support, confidence and trust they have placedin us.Finally, I would like to thank my fellow Board members fortheir stewardship and contribution to the Group.TUNKU TAN SRI ABDULLAH IBNI ALMARHUMTUANKU ABDUL RAHMANChairman
Highly skilled and professional staff assure each customer of excellent service.Sikap profesional dan kemantapan kakitangan kami menjamin setiappelanggan menerima layanan terbaik.BusinessOperations Review32MALAYSIAN LIFEINSURANCE REVIEWThe Life Insurance Division posted a moderategrowth of 7.7% in its total premium income toRM1.4 billion (2004: RM1.3 billion), largely fromsingle premium business, in particular endowmentand investment-linked plans. The continuedpremium growth was attributed to MAA'sextensive network of branches countrywide(currently numbering 76), its sizeable agency forcethat underpin its distribution capacity and brandawareness. The current low interest rate regimeand the shift in consumer preference from plainprotection to savings/investments type of policieshave contributed to the increased sales ofinvestment-linked products and endowmentplans.In terms of annualised new business premiums, ameasure of the year's new sales activity, the LifeInsurance Division has registered a commendablegrowth of 12.3% to RM898.4 million (2004: RM800.2million). This outperforms the 0.6% growth recorded bythe industry, which reflects MAA's ability to furtherpenetrate the market. The slower industry growth wasmainly due to the scaling back of new sales of capitalguaranteedinvestment-linked insurance products by lifeinsurers.The Life Insurance Division recorded a lower ProfitBefore Tax from RM50.8 million in 2004 to RM14.5million in 2005. The lower profit before tax in 2005 wasdue mainly to higher provision for diminution in value ofinvestments made in that year and lower investmentgains, coupled with increase in cash bonus payment andmedical claims from medical policies. Notwithstandingthe transfer of profit to Shareholders' Fund account, theoverall Life Insurance Fund Surplus, remains healthy witha cumulative surplus carried forward of RM500.8 millionas at 31 December 2005.In line with the growing importance of financialplanning services in the country, MAA will continue tofocus its effort on agency training via the enrolment ofagents to the Certified Financial Planner (CFP) course,and the Registered Financial Planner (RFP) programme.The aim of which is to enhance professionalism byequipping agents with financial planning knowledge,and the skills and competency to cope with risingconsumer demand as well as competition from otherfinancial services. Towards this end, with effect from 1January 2005, the Life Insurance Association of Malaysia(“LIAM”) has implemented new ruling requiring lifeinsurance agents who have been in the industry formore than one (1) year to attend module 1 and module2 of the RFP programme, to train agents to becomefinancial planners. As at end December 2005, MAA'sagency force stood at 12,773 (2004: 15,802). Movingforward, MAA's primary emphasis will be to elevate thelevel of professionalism and knowledge of its agents toimprove sales productivity rather than growing the salesforce.The Division has noted the public's changing demandtrend towards investment-linked plans. The Groupexpects this trend to continue in the future, and iscurrently planning even more exciting investment-linkedplans to meet this ever-increasing demand.Plans that have been successfully launched during theyear, include the investment-linked MaaxLife Series (i.e.upgraded version of Maax Wanita, MaaxUmaat andMaaxEducation), Maaster Yield Guaranteed Plan, 2ndtranche of Maaster Capital Guaranteed Plan, personalaccident plans, PA500, insurance plan for senior citizens,the SeniorGold and relaunched of its signaturehealthcare plans, MedicaLife 200 and MedicaGen 200.MAA places great importance on meeting customers'satisfaction. Towards this end, it will maintain itsstrategies and the various initiatives that it had alreadyembarked on, including the development of a CustomerSatisfaction Index (“CSI”) to enhance and raise thequality of our services to customers.On the industry front, 2006 may see the launch of anew common branded Annuity Plan by the NationalInsurance Association of Malaysia (“NIAM”), which willbe a single-premium investment-linked product.Towards this end, LIAM has also submitted to the EPF, aproposal for a participant investment withdrawalscheme, for single-premium investment-linked plans,which are similar to the existing withdrawal investmentscheme for unit trusts. All these efforts are made tooffer the public at large the opportunities of widerinvestment choices and most importantly retirementplanning and wealth management.
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NoticeThere will beno distributiono
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Full Annual Report 2005 - MAA Group

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