Assets of the insurance industry have now reached over RM100 billion and annual premiums generated by the industry are in excess of RM23 billion a year. The market penetration, that is, the number of policies in force as a ratio of the total population, has more than tripled to 38.7% from over a decade ago. At the same time, this growth has been underpinned by a transformation of the industry in terms of the distribution systems, product diversity, sophistication of business models and practices,  BIS Review 76/2006  1  and the state of the art technological advances. With this track record and the structural changes in the environment that are occurring, the prospects for continued growth will remain strong going forward. Importantly, the insurance industry continues to play an important socio-economic role within the economy. It is a signifant institutional investor in the capital market, with over RM49 billion invested in corporate and debt securities. In addition to providing basic insurance protection to individuals and corporations, insurance products have also contributed significantly towards expanding the breadth of financial planning options for individuals. This includes solutions that provide for individuals to finance their retirement needs, medical expenses and children's education, as well as solutions that enhance their investment income. All of you are therefore part of a key industry that forms an integral component of our social and economic fabric.

It also strengthens the network among the workforce of the industry in the region. On this day, all of you have indeed achieved an important step forward in your professional career. The skills and knowledge acquired in achieving your qualifications will enhance your ability to contribute to the performance and development of the insurance industry. In this increasingly competitive and challenging economic and financial environment, knowledge has emerged as a critical factor in defining competitive advantage and success. Ladies and Gentlemen, Significant market developments continue to exert their influence in shaping both the global and the domestic economy. These developments include the increased pace of globalisation, the emergence of new technologies and the increasing importance assigned to the value of knowledge as a determining factor in a country's performance. As competition intensifies, and rapid and dynamic changes take place in the financial environment, the areas of comparative advantage will change. In recognition of these trends, Malaysia has allocated significant resources and attention to human capital development to strengthen the intellectual capacity of our nation. Indeed, human intellectual capital plays a pivotal role in driving future performance and competitiveness. In the financial services sector, the financial landscape will continue to evolve with the proliferation of financial products and services in line with the rapidly changing requirements of the economy and expectations of businesses and consumers. These trends are particularly evident in the insurance industry. Indeed, over recent decade, the insurance industry has seen significant progress and expansion.