16  theSun | WEDNESDAY JANUARY 14 2009

business

Hang Seng S&P/ASX200 KLCI STI Nikkei

13,668.05 3,654.60 TSEC 913.70 1,761.82 KOSPI 8,413.91
302.95 28.70 4,532.36 9.87 14.43 1,167.71 422.89
78.46 10.96

market summary

INDICES
JANUARY 13, 2009

CHANGE
General insurance
FBMEMAS
COMPOSITE
INDUSTRIAL
CONSUMER PROD
INDUSTRIAL PROD
CONSTRUCTION:
5,986.29 -57.90
913.70
2,125.68
288.86
68.57
167.60
-9.87
-6.22
-0.78
-0.55
-2.28
industry in for hard times
by Tim Leonard thefts and road accidents, as well as
TRADING SERVICES 120.54 -0.80
FINANCE 7,292.89 -65.17 newsdesk@thesundaily.com the increasing severity of claims cost
PROPERTIES 546.04 -6.97 per accident, especially for third party
PLANTATIONS 4,428.33 -129.67 PETALING JAYA: The local general in- bodily injury claims.
MINING 249.25 UNCH surance industry is bracing for tougher PIAM’s figures revealed that despite
FBMSHA 6,172.81 -67.46 times this year due to the global finan- a reduction in fatal road accidents,
FBM2BRD 3,987.40 +2.64 cial meltdown and a host of related claims paid out by insurers continued
TECHNOLOGY 13.44 -0.07 problems. to show an increasing trend.
TURNOVER VALUE The General Insurance Association Claims ratio for third party bodily in-
515.745mil RM760.196mil of Malaysia (PIAM) said in a statement jury claims alone, which had exceeded
yesterday that the slowdown is taking 100% for several years, sky-rocketted
a toll on insurance premium growth, to 262% in 2007 and 340% for the first
Prices end lower on You:nique as the average motor premium con- half of last year.
credit tinued to fall while insurers suffer from Express buses and goods vehi-
profit-taking cards higher-than-expected claims ratio. cles are major contributors to the
PIAM statistics revealed that underwriting losses in the motor
SHARE prices on Bursa Malaysia ended lower yester- from general insurers paid out a whopping insurance class with the highest
day as players took in profit after recent gains due to Alliance RM3.94 billion, or an average of RM9.6 claims ratio.
the lack of market-moving news, dealers said. million a day, for motor claims in 2007, In 2007, the combined claims ratio
The benchmark KLCI closed at 876.40, down by Bank out of the total gross premiums of for express buses was 335% followed
4.10 points, led by losses on plantation related stocks pg 18 RM4.68 billion collected the same by goods vehicles at 155%.
like IOI Corporation and Kuala Lumpur Kepong. year. Rising motor claims made by young
IOI Corporation declined 20 sen to RM3.80 and The combined claims ratio (claims drivers were also a major concern to
Kuala Lumpur Kepong dropped 15 sen to RM9.85. costs including acquisition and man- general insurers as industry statistics
The dealers also attributed the weak sentiment agement expenses) amounted to showed that claims ratio attributed by
to the slump on Wall Street overnight and also 114% in 2007. drivers below the ages of 25 was 40%
on regional markets, led by commodity stocks as The claims ratio deteriorated fur- higher compared with other insured
the worsening global recession resulted in lower ther to 121% for the first half of last age groups.
demand for raw materials.
year. The further increase in labour costs
For the actives, KNM dropped 1.5 sen to 49 sen,
PIAM executive director Lim Chia for vehicle repair, falling vehicle values
Tebrau was flat at 51.5 sen, WCT lost three sen to
Fook said that for every ringgit of and the contraction of motor vehicle
RM1.12 and KUB Malaysia rose one sen to 31.5
motor insurance premium collected sales are contributing factors to the
sen. – Bernama
in 2007, insurers expended RM1.14 to declining motor premium income and
pay claims and cost of acquiring and increasing claims ratio in the largest
Clement Hii is The Star’s new boss managing their business. class of business underwritten.
“This figure deteriorated further to The rising motor claims ratio has
KUALA LUMPUR: Star Publications (M) Bhd announced yester- RM1.21 for every ringgit of premium resulted in insurers adopting more
day the appointment of Datuk Clement Hii Chii Kok, 50, as its earned in the first half of 2008,” said stringent underwriting controls on mo-
executive deputy chairman. Lim. tor insurance, including the application
Hii, who is currently group managing director/chief execu- He said as a result, premiums col- of premium loadings.
tive director of SEG International Bhd, succeeds Datuk Steven lected from other classes of insurance This could impact the renewal and
Tan Kok Hiang, 59, who had helmed the company for more business such as fire insurance are be- availability of motor insurance this
than 20 years. ing utilised to subsidise the payment year, according to Lim.
The announcement, submitted to Bursa Malaysia in the of motor claims. Lim advised motor vehicle owners
evening, also included the appointment of two executive direc- PIAM also disclosed that general who find it difficult to obtain or renew
tors, Ng Beng Lye, 47, a former Oriental Daily managing director insurance companies in Malaysia are motor cover to turn to the Malaysian
and China Press general manager, and Datuk Seri Kamal Hashim, suffering from high claims ratio, which Motor Insurance Pool (MMIP) for motor
69, a long-time board member. has exceeded 100% in four out of the insurance protection for their vehicle.
Others who have resigned from the board are chartered last five years. For more information, motor vehi-
accountants Datuk Paul Geh Cheng Hooi, 74, and Datuk Oh The high claims ratio is largely due cle owners can access PIAM’s website:
Chong Peng, 64. to the increase in number of vehicle www.piam.org.my

Kenny Rogers Roasters turns 15

Berjaya Corporation Berhad executive director Datuk Robin Tan (centre), Berjaya Roasters (M)
Sdn Bhd executive director Datuk Francis Lee (right) and general manager Lee Siew Weng
raise a toast to celebrate Kenny Rogers Roasters’ “15 Healthy Years” at Berjaya Times Square
yesterday. More than 700 staff joined the fun-filled celebration. In conjunction with the
celebration, Kenny Rogers Roasters will hold a special “Roasters Rewards & Treats” promotion
tomorrow. The first 50 guests who spend a minimum of RM50 in a single receipt at any Kenny
Rogers Roasters outlet nationwide will be entitled to a year’s reward of Kenny’s Quarter Meal.
Customers will also get to enjoy a complimentary Kenny’s Quarter Meal with purchase of one
Kenny’s Quarter Meal for the day while stock lasts. Turn to Page 13 for details of the promotion.