final phase of the financial sector master plan and into a more competitive landscape, we require robust financial institutions that are resilient, effective and well positioned to serve the nation. in particular, to achieve a financial sector that will effectively facilitate and support sustainable economic growth and transformation. to complement the ongoing efforts to build the capacity of domestic insurers, the bank will continue to leverage on strategic initiatives to achieve the desired financial landscape which will also be better able to contribute to the socio - economic objectives of the country, as well as to be better to withstand competitive pressures in the provision of insurance products and services. consolidation and fostering strategic alliances will have the potential to strengthen the position of the industry to compete more effectively as the market becomes increasingly deregulated and liberalised. in particular, in fostering strategic alliances within the industry, the foreign shareholding limit for new entries in direct insurers has been increased from 30 % to 49 % to harness the potential for financially strong and internationally known foreign players. this would contribute towards enhancing the development of domestic capabilities, particularly in the areas of technical expertise, innovation and improved operating processes. this will provide an additional avenue for potential foreign partners to participate more substantively in the domestic industry through a strategic equity interest in existing licensed insurers. as part of efforts to promote good risk management practices in the financial system, the bank will also consider introducing differentiated premium contributions to the insurance guarantee scheme fund, based on the risk profile of individual insurers. this is similar to that being adopted for the deposit insurance system in the banking sector. this will provide an incentive for insurers to strengthen their risk management practices in order to benefit from lower contributions to the insurance compensation scheme. it is hoped that discussions at this dialogue will contribute towards providing greater clarity in the thinking on the future direction of corporate strategies as well as the regulatory responses to ensure the sound development of the insurance and takaful industry. on this note, i wish you a successful and productive dialogue. thank you.

is one that is based on a relationship of trust and integrity. reputation and trust are indeed the valued assets of the insurance and takaful industries'business. any lapses in market conduct will have widespread implications on the business and on the industry. ensuring fair and equitable dealings with customers should also be a priority. in this environment where the industry originates more and more innovative and complex financial solutions, insurers and takaful operators therefore have a responsibility to ensure that : • consumers receive sufficient information to be able to make informed decisions ; • that they understand the key features of a policy, including any significant exclusions, before any purchase ; • that the recommended policies are suitable for their demands and needs ; and • that their claims are dealt with promptly and fairly. the new environment of increased market discipline now places even greater emphasis on stronger corporate governance, integrity and transparency. high standards of integrity should also define the management of the institution's human and physical resources. in this respect, there can be no substitute for the commitment of an institution's leadership to uphold the highest standards of integrity in dealing with its human capital and corporate resources that are managed on behalf of shareholders and policyholders. achieving success in an environment of greater competition will hinge on the ability of the domestic industry to innovate and provide enhanced value propositions for consumers. this underscores the importance of capacity building by industry players in research and development, and re - engineering of business processes in search of operational excellence and enhanced customer service delivery. a strong culture of excellence is therefore vital : one that is embedded into all levels of the organization ; one that fosters and rewards innovation and service quality. increasingly, highly - skilled individuals will be needed to be able to deliver high value - added products and services, adopt advanced business practices, and have the necessary competencies to build consumer confidence and trust. it is, therefore, crucial for the industry to continuously invest in human intellectual capital to create the pool of talent, skills and expertise that will drive the performance of the industry. to meet this demand, specialised training organisations have been established. they include the international centre for leadership in finance ( iclif ), which is now in its 3 rd year of operation, and the recently - launched international centre for education in islamic finance ( inceif ). the programmes carried out by the malaysian insurance institute ( mii ) have also been reviewed to meet the evolving demands of the financial sector. as we move towards the