DESPITE a challenging year in 2008, the insurance industry has maintained an overall high volume of business.

Bank Negara Malaysia director of insurance and takaful supervision department Yap Lai Kuen said total gross direct premiums for general insurance totalled RM10.5 billion last year, an increase of 3.2 per cent from RM10.2 billion in 2007.

"This is due to the strong performance of the non-motor sectors, in particularly medical and health, liability and personal accident which grew at 16.7 per cent, 10.5 per cent and 9.2 per cent respectively," she said after launching a seminar organised by the Insurance Society of Sarawak in Kuching yesterday.

For the life insurance sector, Yap said there was a slight decrease from RM7.2 billion in 2008 compared with RM7.6 billion in 2007, mainly due to a drop in sales of investment-linked businesses.

"However, it is worthwhile to note that ordinary life recorded a strong growth of 18.6 per cent, thus demonstrating the industry's ability to adapt to a changing business environment," she said.

Yap also emphasised the need for insurance agents to keep up to-date in terms of technical competency.

"This is so given the increasing level of complexity of products offered as industry players pro-actively meet the challenge of slower growth markets by offering new and innovative products."

Yap also said it is important for the public to have the perception that insurance companies have integrity, are trustworthy and treat everyone fairly.

She said Bank Negara has recently issued a concept paper called "Guidelines on the introduction of new products for insurance companies and takaful operators", in which the fair treatment of consumer was discussed.

Among others, the concept paper mentioned the need for insurance companies to put in place policies and procedures to ensure that customers are fully informed through appropriate disclosures of the key features, terms and conditions and risks associated with the product.