Born out of an idea conceived by the Malaysian government to retain premiums within the country, Malaysian National Reinsurance Bhd embarked on its journey in February 1973 with an initial capital of RM2 million. In 1996, the company became a listed entity on the Main Board of the Kuala Lumpur Stock Exchange, now known as Bursa Malaysia Securities Berhad.

As a result of a group restructuring in 2005, the company evolved into MNRB Holdings Bhd (MNRB) — an investment holding company — while its reinsurance licence, business and assets were transferred to a newly formed subsidiary named Malaysian Reinsurance Bhd (Malaysian Re). Its listing status on Bursa Malaysia is now maintained by MNRB, the investment holding company.

AM Best and Fitch Ratings awarded Malaysian Re an “A-” rating in 2006, reflecting its strong financial strength and stability. In 2011, Fitch upgraded the rating to “A”, which Malaysian Re has maintained.

After 50 years of dominating the local reinsurance market, Malaysian Re is seeking to transition from predominantly serving the domestic market to becoming a prominent regional player, emphasising a globalised business profile by expanding its overseas operations.

The plan, which was detailed in its strategic initiative that outlined the company’s strategic roadmap for the period of 2023-2025, also encompasses a strategic pivot towards specialisation and an emphasis on fostering the growth of the retakaful business segment, all while retaining the company’s domestic leadership position.

With an impressive 55% domestic market share in 2022, Malaysian Re remains vigilant in guarding against complacency, continuously innovating to maintain its existing clients while diversifying its growth strategies, says president and CEO Ahmad Noor Azhari Abdul Manaf.

“Our resilience in the marketplace is attributed to our commitment to value-added services and the cultivation of unwavering trust and relationships with our domestic clients — a partnership we are steadfastly dedicated to preserving.

“While our aspiration to uphold our market leadership position is resolute, we also acknowledge that the domestic general insurance market has reached a saturation point. To counter this, we have proactively diversified our growth strategy, strategically tapping into growing sectors like retakaful, within both the general and family businesses. Moreover, we have pursued an international growth [strategy], targeting specific markets and business lines to expand our global footprint,” Ahmad Noor Azhari adds.

Since making its mark with its first international office in Dubai in 2006, Malaysian Re now has a global footprint spanning more than 30 countries.

Its international endeavours have yielded notable results, contributing RM1.01 billion, or 52%, of its RM1.95 billion total gross premium written for the financial year ended March 31, 2023 (FY2023).

Regionally, Malaysian Re sees the highest contributions from Asia-Pacific, with RM467 million (46%), followed closely by Europe at RM436 million (43%) and the Middle East with RM109 million (11%).

Ahmad Noor Azhari says the push for international expansion is part of the company’s efforts to adapt to the business landscape, which has been transformed by factors such as climate change and urbanisation.

“This strategic move aligns seamlessly with our diversification strategy, enhancing the breadth of risks within our portfolio and mitigating potential systemic vulnerabilities arising from concentrated exposure in the domestic market.

“Our expansion beyond conventional treaty business has seen a deliberate focus on speciality lines, marking a progressive step forward. Additionally, we have strategically deepened our engagement with managing general agents (MGAs), a move that grants us efficient access to a diverse range of speciality risks within international markets,” he adds.

Beyond financial gains, Ahmad Noor Azhari highlights that the international ventures have also facilitated invaluable knowledge exchange and talent enhancement through collaborations with global business partners, which benefit its clients and stakeholders at home.

“Drawing from the best practices observed in advanced markets across various lines of business, we are uniquely poised to catalyse innovation. This, in turn, enables us to support our domestic clients in crafting new products and services tailored to Malaysian consumers, thereby driving the industry forward,” he says.

In synergy with its international and speciality business expansion, the retakaful sector has emerged as a pivotal growth engine for Malaysian Re. Ahmad Noor Azhari says the takaful and retakaful segments, which have been offered through the Malaysian Re Retakaful Division (MRRD) since 2016, have exhibited robust growth over the years, surpassing conventional insurance in both the general and family (life) domains.

“Significantly, our approach transcends mere price competition, as we have strengthened our offerings with value-added services encompassing underwriting engines, shariah reviews/audits, and comprehensive underwriting and claims assessments for our clients,” he says.

Furthermore, Malaysian Re’s international expansion endeavours are strategically pinpointed. Ahmad Noor Azhari says the target markets in Asean are naturally Indonesia and Brunei, alongside those with notable Muslim minority populations, such as Thailand and the Philippines.

Meanwhile, the burgeoning takaful landscape in nations such as Pakistan, Bangladesh and the Middle East also place them on the list of markets primed for retakaful arrangements, in both the general and family segments.

“Our ultimate vision for MRRD encompasses self-sufficiency; it is poised to attain economies of scale. Upon achieving this milestone, we envision exploring avenues that create shareholder value,” Ahmad Noor Azhari adds.

Malaysian Re fully supports Bank Negara Malaysia’s initiative in building resilience in the industry to climate change and continuously works closely with the domestic industry to prepare for a transition to a greener economy.

With a steadfast commitment to using the United Nations Sustainable Development Goals (UN SDGs) as a roadmap for guiding its sustainability practices, Malaysian Re has made significant strides in its implementation plans.

For instance, the company has improved its Business Remodelling framework to incorporate the environmental, social and governance (ESG) agenda in its underwriting strategy. This integration enables it to make more informed decisions in alignment with ESG considerations.

“As part of our commitment to addressing climate change, we have proactively bolstered our capacity to provide catastrophe reinsurance protection. This not only reinforces our resilience but also contributes to a more sustainable future,” Ahmad Noor Azhari says.

In addition, Malaysian Re led the proposed establishment of a regional Green Energy initiative. Simultaneously, Ahmad Noor Azhari says, the company is expanding its facultative business in the clean energy sector, reflecting its dedication to both environmental responsibility and the success of its clients during their transition towards cleaner energy sources.

“In Malaysian Re, we believe that part of our business success stems from our effective ability to identify and address economic, environmental and social (EES) issues. These factors include both risks and opportunities relevant to our operations,” he adds.