Dhivehi Insurance’s Abdul Wahid Thaufeeq sat down with Maldives Business Review to talk about his lengthy career in insurance and his work in developing a thriving modern insurance sector in the country.
Dhivehi Insurance is a relatively new company. How did it come into being?
Dhivehi Insurance began way before the company’s inception. My career was in insurance. I joined Allied Insurance back in 1993. Back then, there were not many people in insurance, especially Maldivians. We only had six staff and we operated on a very limited scale. The other parties in the field at that time were foreign parties, mostly running their operations from Sri Lanka, they had some representation here. So they did not have registered offices, they were running very informally and completely employed expatriates, mostly Sri Lankan nationals. Because they were operating for some time, then MMA (Maldives Monetary Authority) granted them a license, certifying they were working as insurance providers. Even after they were granted a license, even after they had operated in the country for five, ten years, they still employed expatriates. Maldivians had no share in it. Maldivians could not develop any skills in those areas.
That is a grievance I had – Maldivians had no say in this sector, Maldivians could not develop or thrive in this sector. They were not in management levels. We can only strengthen insurance sector as a sector, have a wider component, become a more personal based resource if locals are given a chance. Insurance is not a visible tangible product, it is a service. What we sell is our talent, our expertise. If we do not have that expertise, then we cannot thrive, we will not flourish.
Another grievance I had was that when expatriates came into this field, they have a very short term view of the market. They know they have the possibility of going back to their home after working here for two or three years. Their views, because of this, is very short term. So, they do not put in much effort to expand the market on a long term basis. They want to enjoy the profits of the sector, rather than focus on building the sector. Customer responsibility, customer awareness, maintaining standards, staying here, facing the market and developing it take a back seat.
So this is why I wanted to create something that fit into our needs. I was working in a state owned company. I saw that in the private sector there was no Maldivian company. There was a need for a local company in the sector. After 20 years in Allied, I left in 2013. At Allied, we had the opposite of what we observed in the private sector. Over the years, we built the expertise, made the company into one that was 100 percent Maldivian. I wanted this for the private as well, using my experience, expertise and entrepreneurial skills.
After my resignation in 2013, I took a break of three years before starting Dhivehi Insurance with my other partners.
The main aspiration, focus of this company is that this is a home grown indigenous company. We aim to be here for a very long time. We are here to grow the market both in terms of expertise and in terms of bringing positive standards for the market. We also want to focus insurance on areas that are not targeted in this market, especially, developing businesses such as SME’s. Businesses in the Maldives are quite young. There are a handful of companies in the Maldives that are 50 or 60 years old. We have more startups. If a business is younger than 10 years, we see it as in its infancy. Those businesses are still developing and learning as they grow. Their standards are also the same. Those companies will not have the same skills as that of a fully developed company, say if they are submitting documents required to seek a financial service. We really have to see the people who are behind these companies, what is their business concept and we have to make a judgement on what is not just on paper but actually see the company.
This is something Dhivehi Insurance is focusing on. This may not be what is so obvious. Those businesses may not be top standards, but are very good companies, which needs help and which have the potential to grow. we’re taking a very long term view of the market. Our market share based on our resources, I would say is okay for what we have done so far. But we’re not as big as other players in the market. However, this is a journey for us and we are happy with what we have achieved so far and we’re progressing every day.
What is the current scope of the insurance sector?
The sector is moving forward on a day to day basis. Insurance is an indicator of the pulse of the economy. The sector grows as other companies grow, their asset base increases. Taking into account the past 20 years, insurance sector had, both in terms of what needs to be insured and awareness of insurance, it is much more now.
The other aspect is the massive development projects being undertaken. Banking finance is a core component of this. It is now compulsory to take insurance. In the general market there was a shift towards compulsory insurance, like motor insurance.
Overall, insurance has grown from a business that was in a corner, to something that is now mainstream. People now see it as something we need. We’re working towards awareness, as something we need.
Insurance penetration is increasing in the country. There are more companies now involved in the process. They make more effort to engage with clients and sell more.
Currently what are the challenges facing the sector?
I think the biggest challenge, I would say, is twofold. First is proper regulation and the second is expertise in workforce. Due to historical reasons, regulations were weak. There were unfortunate events because of this, both with local parties and foreign parties. Due to gaps in regulation, we are not able to secure insurance in this country. As a market, we would grow only when all companies in the country take insurance from a local insurance provider and retain that in the country and we have the funds for that.
The other aspect is the expertise and standards aspect. This is vital. We can maintain standards when companies with a long-term view come into play. They have to have a long-term view to develop the market, have a common view to set industry standards. We have to maintain those standards and cater to the customers and only with the customers we can achieve this. If we lose customer confidence, it would be very difficult to develop this. Customer confidence is very important to us.
What are the new products or services the insurance sector can bring into the market?
I think the insurance sector is rapidly changing from an asset based insurance coverage to more financial and liability based coverage. Before in Maldives insurance was taken only for vessels, properties. Now there is a legal aspect to it. Then there is the possibility of having instruments like insurance for medical negligence or malpractice, liability insurance. The other aspect is that insurance will give financial guarantees to the companies. Some part of the business companies are doing. We have seen the introduction of aspects like performance guarantees to the contractors, advanced payment guarantees. There is a possibility that insurance could be introduced to give a solution to financial management that can help in developing businesses. These are not long term businesses run by banks. Insurance sector can address this aspect, because they have the financial backing to develop this. I think insurance sector has the possibility to cater to this next phase.
You have spent two decades in the sector; what drives you?
That is a good question. Actually, I have spent two decades in the sector and I was the first person to have a professional qualification in the field, the first chartered insurance agent in the Maldives. So I have a lot of personal achievement in insurance. But, I feel that others also can have this achievement together with me. That’s what drives me now. I have worked in one company, I have the satisfaction of building that company and building that team. So I want to emulate that again and to work together with others to bring new professionals to the field and industry. It’s not much about me personally now. That’s the gratification I have, people are working with me not for me in developing the industry.
What was the pivotal moment in your career?
In 2010, I hosted a regional insurance conference. It was the first insurance conference in the country, where companies from Africa and Asia took part in it. So at that moment, I was the host of the conference and I thought we have taken the next step. That our market is open to outside world, we had new engagement with new partners. That this will put the Maldivian insurance market more on the spotlight. That, I think was a defining moment for me in my career. I thought there was the possibility to do business outside of our waters, not just being a domestic market. That we can work with foreign companies. With good cooperation, we can make Maldives a hub for insurance in the region. Even though this is an idea, it is a practical one. That coming together of companies in the Maldives was quite a heartwarming moment for me.
What advise would you give to new entrants into the sector?
This is something you have to learn every day – if you are keen and if you want to learn every day, if you wake up every day with that vision to advance yourself. You have to keep your mind open. This is not an industry where you can learn everything in one day. Every day you have to face different situations. Its years of progressive learning and I would say it is something that you improve incrementally. You can become a really great professional at this. If you really want to become a professional in the sector, set aside the time and effort for it. With this I’m sure that you can make an impact into the sector and country.