KUALA LUMPUR, Jan 4 — Bank Negara Malaysia (BNM) today issued the Discussion Paper on Licensing Framework for Digital Insurers and Takaful Operators.
The paper outlines the proposed framework for licensing new digital insurers and takaful operators (DITOs) to encourage digital innovation in the insurance and takaful sector as well as complementing BNM’s initiative on digital banks and digitalisation of the financial sector.
In a statement today, BNM said DITOs are expected to contribute to a more inclusive, competitive, efficient insurance and takaful sector in line with evolving needs of consumers.
“The proposed framework aimed to attract new digital players that can offer innovative solutions to address critical protection gaps among the unserved and underserved market segments as well as enhance customer experience and elevate trust,” said governor Tan Sri Nor Shamsiah Mohd Yunus.
BNM added that the framework will adopt a balanced approach with the focus to encourage more significant innovation while promoting financial stability and protecting consumer interests.
“The discussion paper covers the requirements for entry, such as criteria in assessing an application and capital requirement, and explores new business models such as risk-sharing.
“Bank Negara aims to issue an Exposure Draft upon obtaining feedback from the discussion paper. This will be followed by a Policy Document on prudential and business conduct requirements for DITOs in 2022,” said BNM.
The central bank said the applications for a DITO licence will be open at a later date, meanwhile BNM is inviting written feedback on the discussion paper by February 28, 2022. — Bernama
