Operational resilience begins with clarity. To build meaningful resilience capabilities, an organisation must first understand who it is, what it does, whom it serves, and how it creates value. This chapter provides a structured understanding of Malaysian Life Reinsurance (MLRe) within the context of ISO 22316 (Organisational Resilience) and the operational resilience expectations issued by Bank Negara Malaysia (BNM).
For Malaysian Life Reinsurance, strengthening resilience is not only about compliance. It is about sustaining confidence in Malaysia’s insurance ecosystem, protecting cedants, and maintaining stability across the financial system during disruption.
Malaysian Life Reinsurance is Malaysia’s national life reinsurer, providing reinsurance capacity and technical expertise to life insurers and takaful operators. As a key participant in the financial services sector, MLRe supports risk transfer, capital management, product innovation, underwriting, actuarial services, and claims management for primary insurers.
Its role makes it a systemically important supporting institution within Malaysia’s insurance landscape. A disruption at MLRe may not be directly visible to retail policyholders, but it can materially affect insurers’ ability to manage risk exposures, settle claims, or launch products.
Under ISO 22316, organisational resilience requires:
BNM’s operational resilience framework further reinforces these principles by requiring financial institutions to identify critical business services, set impact tolerances, map dependencies, and test resilience against severe but plausible scenarios.
As a licensed reinsurer regulated by Bank Negara Malaysia, MLRe operates within Malaysia’s prudential regulatory framework under the Financial Services Act 2013.
MLRe contributes to:
Because reinsurance sits upstream in the insurance value chain, MLRe’s resilience has multiplier effects. If MLRe is unable to perform treaty renewals, honour claims recoveries, or process underwriting decisions, cedants may experience liquidity stress, operational bottlenecks, or capital strain.
BNM’s operational resilience expectations therefore extend beyond customer-facing institutions to include entities whose disruption could threaten financial stability.
BNM’s operational resilience policy requires financial institutions to:
For MLRe, compliance examples may include:
Examples relevant to MLRe:
BNM expects these services to be clearly defined based on the impact on:
Impact tolerances must specify the maximum tolerable disruption, for example:
These tolerances must be board-approved and aligned to MLRe’s risk appetite framework.
MLRe is required to document and understand dependencies such as:
BNM expects institutions to identify single points of failure and concentration risks, particularly in third-party arrangements and shared services.
MLRe must test its resilience against severe but plausible scenarios such as:
Testing must assess whether impact tolerances would be breached and identify remediation actions.
BNM requires:
For MLRe, this means operational resilience cannot sit solely within IT or risk functions — it must be embedded into strategic decision-making.
Understanding MLRe’s resilience requires analysing its end-to-end value chain.
MLRe evaluates mortality, morbidity, and longevity risks. Disruptions in actuarial models, underwriting systems, or data quality can compromise pricing accuracy and capital adequacy.
Timely claims reimbursement to cedants supports insurers’ liquidity and policyholder obligations. Operational breakdowns here could create systemic ripple effects.
MLRe transfers part of its risk to retrocessionaires. Failure in retrocession documentation or counterparty risk management could amplify financial strain.
As a life reinsurer, MLRe holds long-term liabilities. Disruptions in investment operations, valuation systems, or custodial services could impair solvency management.
BNM expects timely, accurate, and complete reporting. Data integrity issues or system failures could expose MLRe to supervisory action.
Each component must be viewed through an operational resilience lens.
ISO 22316 emphasises that resilience is rooted in culture.
For MLRe, this includes:
BNM’s guidelines reinforce the importance of embedding resilience into everyday decision-making rather than treating it as a compliance exercise.
Practical examples include:
As MLRe modernises underwriting systems and data analytics platforms, technology resilience becomes central.
BNM expects financial institutions to ensure:
For MLRe, digital resilience must consider:
Technology resilience should be regularly stress-tested and aligned with business impact tolerances.
MLRe’s resilience must account for multiple stakeholders:
Under ISO 22316, stakeholder trust is both an input and an outcome of resilience. BNM’s expectations further require transparent communication during disruptions to preserve market confidence.
Operational resilience should support MLRe’s long-term strategy, including:
Resilience considerations should inform:
This forward-looking integration ensures that resilience strengthens competitive advantage rather than constrains growth.
Understanding Malaysian Life Reinsurance is the foundation for building meaningful organisational resilience.
As a regulated reinsurer operating within Malaysia’s financial system, MLRe must align ISO 22316 principles with the operational resilience expectations of Bank Negara Malaysia. This includes identifying critical business services, setting impact tolerances, mapping dependencies, conducting scenario testing, and embedding strong governance.
Operational resilience for MLRe is not merely about surviving disruption. It is about safeguarding financial stability, protecting the broader insurance ecosystem, and sustaining long-term confidence in Malaysia’s reinsurance market.
By clearly understanding its purpose, structure, dependencies, and regulatory obligations, MLRe positions itself to anticipate shocks, adapt effectively, and emerge stronger from disruption.
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Building Organisational Resilience: An Operational Resilience Guide for Malaysian Life Reinsurance |
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| eBook 1: Understanding Your Organisation: Malaysian Life Reinsurance | |||
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For organisations looking to accelerate their journey, BCM Institute’s training and certification programs, including the OR-5000 Operational Resilience Expert Implementer course, provide in-depth insights and practical toolkits for effectively embedding this model.
To learn more about the course and schedule, click the buttons below for the OR-300 Operational Resilience Implementer course and the OR-5000 Operational Resilience Expert Implementer course.
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