Sun Life pivots to southeast Asia as other markets slow
By Al-Zaquan Amer Hamzah and Yantoultra Ngui
KUALA LUMPUR May 26 (Reuters) - Sun Life Financial , Canada's third biggest insurer, is boosting investment in Indonesia and Malaysia at a time when growth in earnings from some core Asian markets has slowed.
"This is not the time to slow down in Indonesia - companies that don't make the investment are going to find themselves quite far behind," Kevin Strain, president of Sun Life Financial Asia, told Reuters.
Sun Life manages assets of $590 billion globally and aims for its income contribution from Asia to reach 12 percent by 2015 against 10 percent now.
Earnings in China declined last year as Sun Life focused on retaining profitability, said Strain, while numbers in India - its biggest market in Asia - also fell after regulatory changes there.
"From a growth percentage, Indonesia and Malaysia will grow faster than India, but India is a big and sophisticated business. We should see some of that growth coming back."
A big part of the expansion in southeast Asia will be growing the company's takaful (Islamic insurance) business, which contributes half of sales in Malaysia and 16 percent in Indonesia.
The company is spending $40 million to double its number of agents in Indonesia, as it prepares a distribution strategy to navigate the country's largely underserved insurance market. About 1.8 percent of Indonesians are insured, compared to Malaysia's 4.8 percent.
"We have a real opportunity to become a much bigger player," said Strain. Continued...