Allianz expecting some insurance payment defaults

KUALA LUMPUR, 19 May 2020:

Allianz Malaysia Bhd is anticipating more insurance payment defaults come October after the six-month loans moratorium period ends, said its chief executive officer Zakri Khir today.

At present, the insurer does not experience much impact, he said. “In any recession or economic downturn, this would be an issue because of cash flow.

“We anticipate that this would come more and more especially come October when the moratorium of loans is over and people have to pay their loans and their daily needs.

“And then we would see a really cash flow crunch but we will deal with it as it comes, very professionally, very intelligently, very emotionally as well because some of these people who potentially default are very very old customers,” he said when responding to a question on whether there were any default payments by its customers during the e-launch of Allianz Smart Retail Shield.

As for sales, he said, Allianz was recording better sales until March compared to last year but did not share the figure.

He said while Covid-19 triggered more protection needs, consumption is also declining amid unemployment rising and a decline in household income.

Hence, the insurer launched Allianz Smart Retail Shield, a flexible A-Z protection plan for businesses covering retail shops, restaurant, boutique and salon, office as well as hotel and motel.

Zakri said small and medium-sized enterprises (SMEs) which are looking to bounce back from Covid-19 related impacts can sign up with Smart Retail Shield.

The plan allows them to build on their fire insurance coverage with customisable coverage.

These include protection against commercial fire and coverage such as Inconvenience Relief Benefit, consequential loss, and terrorism; safeguarding of business assets (Burglary, Machinery Breakdown, Goods in Transit, and more); taking care of the welfare of employees and protection against other exposures.

“SMEs such as boutique hotels to baker’s cafes makes up nearly 98% of businesses in the country and were among the hardest hit by the Covid-19 pandemic.

“As one of the main drivers of the Malaysian economy, SMEs provide jobs for almost two-thirds of the Malaysian workforce and contributed 38.3% or RM521.7 billion in gross domestic product in 2018.”

– Bernama