Etiqa credits growth of online channel to early adoption

Firm was one of the first to launch its online portal, avoiding friction with its intermediaries

Etiqa credits growth of online channel to early adoption

Insurance News

By Gabriel Olano

Malaysian insurer Etiqa said that being among the first insurers in the country to sell online helped its growth immensely.

Etiqa, the insurance and takaful brand of Malayan Banking Bhd (Maybank), began selling insurance products online in 2006, becoming an early adopter of the technology in Malaysia.

“We were the first mover in the online channel back in 2006,” Kamaludin Ahmad, CEO of Maybank Ageas Holdings Bhd, told Edge Markets. “The concern at the time was, why was it that people are comfortable buying goods via the internet but not insurance? Why can’t we do it online?”

According to Kamaludin, other insurance companies were hesitant to go online, as they feared that it would upset intermediaries and cannibalise their business.

In order to avoid friction with its intermediaries, Etiqa launched its online portal,, which did not contain the Etiqa brand in its URL.

“By doing this, while the agency channels are aware of it, they don’t see it as a direct competitor,” said Kamaludin. “Of course, the challenge then was to kick-start [the portal] and make it known without relying too much on the Etiqa brand.”

While it took several years for Etiqa’s online channel to take off, it eventually did, with online revenue reaching MYR120 million (US$29 million) in 2016.

Despite impressive growth of Etiqa’s online channel, it still contributes only a small part of the group’s total revenue. According to Kamaludin, some insurance products, such as life insurance and takaful, are harder to sell online due to the products’ complexity and lack of urgency to buy them. In these segments, the agency channel still dominates.

“It’s still very hard to sell life insurance through the internet,” he said. “Not everyone is comfortable with buying something online for between MYR2,000 and MYR4,000 a year. The smaller ticket items such as general insurance and travel insurance are easier [to sell]. Perhaps the term life insurance or takaful will entice people to consider buying online but it has to be affordable and it has to be a simple product that is easily understood.”

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