More Awareness Should Be Created For Captive Insurance

KUALA LUMPUR, Oct 17 (Bernama) -- Local companies should be more exposed to captive insurance which is at an infant stage in Malaysia, says Chief Executive Officer, Labuan International Business and Financial Centre (Labuan IBFC) Malaysia, David Kinloch.

He said currently there were about 14 companies which have established the captive insurance business in Labuan.

Captive insurance companies are insurance companies established with the specific objective of financing risks emanating from their parent group or groups, but they sometimes also insure risks of the group's customers as well.

Using a captive insurer is a risk management technique by which a business forms its own insurance company subsidiary to finance its retained losses in a formal structure.

"As far as we are concerned, the Malaysian market is huge and captive insurance only fits in when you are spending a lot of money on insurance products," he told reporters after a conference on captive insurance here Monday.

He also said the current global financial crisis was actually helping the growth of captive insurance.

"Our focus now is regional. We are actually taking business back from other jurisdiction, both in wealth management, banking and insurance, as the region becomes more sophisticated in its risk management and insurance buying," David said.

-- BERNAMA

Source : http://finance.bernama.com/news.php?id=620430