Over the coming months, we will be able to form a clearer view on the market impact of premium rate adjustments. This will allow us to consider further flexibilities in the pricing bands. We hope that this in turn will drive further product innovations in addition to expanding capacity going forward. Internationally, developments in global regulatory and accounting standards will also see corresponding changes in the domestic regulatory environment. A key development has been the ongoing work by the IAIS to establish a risk-based global Insurance Capital Standard. It is the Bank’s intention to align domestic regulations with international standards to promote the resilience of the industry. However, we will always do so with a careful consideration of domestic specificities. The Bank trusts that the industry will continue to ramp up its preparation towards full implementation of the IFRS 17 in 2021. In the next two years, the Bank will be reviewing the valuation and capital standards for solvency reporting. This will take into account the potential areas of alignment with international solvency and accounting standards. The results from the quantitative tests and feedback from industry engagement will be valuable inputs for these upcoming reviews. As you are no doubt aware, these standards are inherently very complex. As the industry prepares for them, there is a need to strengthen capacity and arrangements – both at the institution and industry levels – to support implementation. This includes ensuring effective organisation and coordination of technical work at the industry level through the actuarial and industry associations.

The data processing power of the computer allowed the industry to design new products, scale up operations and increase efficiency. Fast forward to today, we are at the brink of another great technological revolution and disruption. Artificial intelligence, big data and robotics will reshape the way we live, work and play. In many ways, the industry is in a prime position to seize the opportunities arising from these technologies given that the ability to manage risks remains the single most compelling proposition of insurance. For example, e-hailing services have become part and parcel of modern life. Many of the drivers do not benefit from generic motor insurance products. Perhaps usage-based or pay-as-you-drive insurance policies would be better suited for these consumers. Technology such as telematics could also be adopted to incentivise drivers to good behaviour. Artificial intelligence and blockchain can be utilised to enhance the efficiency of the claims settlement process. As a service industry, it is important for insurance companies to address the user experience. From our extensive engagements with the public, many Malaysians still find purchasing insurance too much of a hassle. Products are perceived to be too convoluted, complicated and non-transparent. We are taking this very seriously, particularly given the measures we have taken to encourage the use of plain language coupled with clear and concise disclosures. 2/4  BIS central bankers' speeches  Clearly, these measures have not had the desired effect. There is an urgent need for the industry to design a more positive customer experience.