Takaful / Insurance

Profits slide for #Qatar Islamic Insurance Company

Qatar Islamic Insurance turned in nine months net profit of QAR 50.117 million, down 29.6 per cent on the QAR 71.212 million recorded in 2015. Earnings per Share (EPS) amounted to QAR 3.34, compared to EPS amounted to QAR 4.75 for the same period of the previous year.

National Bonds unveils findings of financial health check for Q3 2016

National Bonds Corporation, a Shari'ah-compliant savings and investment company in the #UAE, announced the results of its financial health check for Q3 2016. The survey found that the majority of the UAE’s residents are yet to sign up for Takaful coverage while only a minority is covered by traditional insurance. Within the UAE national pool of respondents, 89% admitted to not being insured against disabilities through Takaful in contrast to 11% that have traditional coverage against disabilities. The financial health check also charted the financial stability of participants. The results of the present survey are encouraging and indicate that 67% of UAE nationals and 72% of expat residents plan to pay off their liabilities and become debt free by end of this year.

Bank Islam unfazed by developer loans proposal

Bank Islam Malaysia Bhd said the proposed move to allow developers to provide loans to house buyers will not have a severe impact on the bank, as it will continue to focus on its target market.
“For us, we don’t see any reduction in (our) approval rate, mainly because our target market remained stable,” its deputy CEO Khairul Kamarudin told reporters after launching the bank’s Visa Infinite Business Credit Card-i (business card-i) here yesterday. “Our target market has always been the middle income (segment) and we will continue focusing on our target market and we are seeing the same approval rate (going forward)”. Khairul said the bank’s approval rate last year was 70%, and slightly better this year at 71%, to date. He also said the bank has not experienced high loan rejections despite the current uncertain economic conditions. “People (borrower) who are eligible last year are also eligible this year. For the ones who have their applications get rejected are maybe for the ‘high ticket’ properties,” he added, noting that the bank is more focused on providing loans for affordable housing.

Islamic insurers need to focus on profitable lines

The overall profitability of Takaful industry is under strain largely because the industry has yet to break into some of the most profitable lines of business that are dominated by conventional payers, according to rating agency Standard & Poor’s.
“In our view, the takaful sector is underperforming, especially in the UAE, because it lacks the advantages of conventional insurers, which are often larger and benefit from better economies of scale. They have more-established distribution mechanisms and so their revenue generation is less dependent on intermediaries,” said Emir Mujkic, Associate Director, Finance Services of Standard & Poor’s.
The crowded UAE and other Gulf Cooperation Council insurance markets often suffer from overcapacity, which can often trigger aggressive price wars. “In our opinion, Islamic insurance companies require considerable capital investment to become established, yet relatively new companies often come under pressure to generate profits and deliver healthy returns to their investors,” said Mujkic.

GCC’s #takaful players face pressure on profitability

According to Standard & Poor’s, profitability of the GCC takaful industry is expected to remain relatively weak during the current year and the year ahead despite an impressive 20% year-on-year growth gross premiums in 2014 and 2015. Most takaful players are still relatively small compared with their conventional peers. Their shorter track records and less-diverse books of business put them at a disadvantage now that the falling oil price and stricter regulation are hitting GCC insurance markets. Including Saudi Arabia, the GCC’s Islamic insurance market generated an estimated pretax surplus of more than $260 million in 2015. But the takaful sector in the remaining GCC states generated a combined net loss of about $5 million in 2015 and net losses surged to about $11 million during the first six months in 2016.

Amana #Takaful Life shares debut on Colombo Stock Exchange

Amana Takaful Life Limited (ATLL) rang the opening bell to commence trading and celebrate the listing of its shares on the Colombo Stock Exchange (CSE). Speaking at the event, ATLL Director Dato' Mohd Fadzli Yusof stated that the listing brings ATLL to the mainstream of the financial landscape in Sri Lanka. Chairman of CSE Vajira Kulatilaka congratulated ATLL for achieving a successful listing. He also added that while listing on the CSE adds immense value and prestige, it also comes with obligations to investors and other stakeholders. Amana Takaful Life Limited and its parent, Amana Takaful PLC are fully fledged Takaful companies, offering life and general insurance solutions. ATLL distributes its products through an island-wide network of 26 branches, covering 22 districts.

SAMA Controls #Insurance Companies’ Performance

Saudi companies willing to become public holding firms have slowed down the process, following a drop in prices of new companies listed in local share markets dealings. The forbearance of Saudi companies affected the region’s market. Saudi share market concluded the first week sessions with a slight drop and it closed at 6,212 points amid USD613.3 million (SAR2.3 billion) monetary liquidity, which is considered the least in five years. Saudi Arabian Monetary Agency (SAMA) continued its positive movements to enhance performance of local insurance companies.

#Malaysian insurers to target Europe in Islamic finance push

Malaysia’s Islamic insurers are considering a move into Europe by targeting the continent’s growing Muslim population. Amat Taap Manshor, chief of the Financial Accreditation Agency (FAA), said it may not happen right away but a lot of Islamic insurers are looking to target the Muslim middle classes in the UK, Germany and France. Manshor made the comments during the signing of a memorandum of collaboration between the FAA and the British accreditation council (BAC). The partnership hopes to offer financial services globally accredited courses in Islamic finance.

#SriLanka’s Amana #Takaful Life to list on Thursday

The shares of Amana Takaful Life will be listed on the Colombo Stock Exchange on Thursday. The initial public offering of Amana Takaful Life by way of an offer for sale of 75 million rupees was oversubscribed at its opening day on 21st July, 2016. The company offered 50 million ordinary voting shares at 1.50 rupees per share which represents 10% of its total stake.

QIB offers online travel #takaful plan to customers

Qatar Islamic Bank (QIB) has introduced online instant purchase for its new Travel Takaful plan. From now on, QIB’s customers can conveniently purchase Travel Takaful plan through the Bank’s website www.qib.com. The comprehensive plans are offered by Damaan Islamic Insurance Company (Beema) and provide a wealth of coverages. Benefits include compensation in case of lost/delayed baggage, delay in departures, or in the event of lost passports, National IDs and driving licences.
A key benefit is the coverage of medical expenses incurred abroad, including hospital and surgical costs, dental emergencies and other needs that can occur when traveling.

Sharia compliance in deposit insurance

In #Indonesia deposit insurance is an integral part of the financial fractional-reserve banking system. This structure was put into place twelve years ago through the enactment of the Indonesia Deposit Insurance Act 2004. Islamic deposit insurance has become more relevant of late due to the worldwide development of Islamic finance. Related to the implementation of the fractional banking reserve system in Islamic banking institutions (IBIs), there are issues to do with the reserve structure that is incompatible with sharia principles. Deposit insurance does involve the exchange of money for money and the exchange occurs with different values and at different times. Hence, some sharia scholars would argue that it is an interest-based transaction and therefore non-permissible.

#Swiss firm buys two #Malaysian insurers to add #takaful products to its portfolio

Swiss insurer Zurich Insurance Company has bought MAA Takaful (MAAT) from MAA Group and Solidarity Group Holding to expand its insurance and takaful business in Malaysia. Zurich Insurance Malaysia CEO Philip Smith said the company will be able to provide a wide range of insurance and takaful solutions across multiple customer segments, supported by the technical and servicing expertise in the wider Zurich Group. The acquisition cost RM525 mn and about RM400 mn was paid at the closing of the transaction. The remaining amount will be paid on the third anniversary after the closing.

The IFSB, World Bank and Turkish Treasury Organise a Joint #Conference on Value Proposition of #Takaful Industry in Istanbul

The Islamic Financial Services Board (IFSB), The World Bank Group (WBG) and the Republic of Turkey have organised a joint conference focusing on the takaful sector. This conference, themed "Realising the Value Proposition of Takaful Industry for a Stable and Inclusive Financial System" was held in Istanbul on May 30-31, 2016. The Keynote Address was delivered by Ramazan Ulger, President of the Turkish Insurance Association and Ozgur Koc from the Association of Participation Insurance. Mr. Ulger highlighted that there are 60 insurance companies and one reinsurance company operating in Turkey. He suggested for the takaful industry to develop a wider range of products to address the needs of individuals. Ozgur Koc reiterated the country's vision to establish Istanbul as an Islamic financial centre.

Islamic #insurance guarantees financial security

The federal government has urged Nigerians to embrace Islamic insurance as it can guarantee economic security in times of economic uncertainties. At the official launch of the book Understanding Takaful, the minister of Education, Malam Adamu Adamu, described takaful insurance as a safety net for the community. The author of the book, Malam Zubairu Sulaiman Darazo, identified the interest rates inherent in conventional financial institutions as responsible for the low level of insurance penetration in Northern Nigeria.

Egyptian #Takaful Non-life, Hannover Re to start reinsurance talks in June

Egyptian Takaful Property and Liability Insurance (EGTAK) will soon start talks to renew its reinsurance agreements with Hannover Re SE. Head of the Reinsurance Department Hamed Mahmoud said he expects the German reinsurer would renew its agreements without placing any additional conditions.

Al-Khaleej #Takaful boosts stake in #Qatari Unified Bureau Insurance

The Board of Directors of Al-Khaleej Takaful Group has agreed to increase the company's stake in Qatari Unified Bureau Insurance to 25 % from 20 % at a cost of QAR 6.75 mn. Al-Khaleej Takaful Group reported net profit of QAR 43.38 mn for the year to end-December 2015, down from QAR 74.4 mn a year earlier. Qatari Unified Bureau Insurance is a limited liability company which provides insurance on vehicles entering the country and sells insurance cards for vehicles travelling outside the country.

New insurance rules bode well for #Qatar

Sheikh Abdullah bin Saud Al Thani, the governor of the Qatar Central Bank (QCB), issued operating instructions and governance principals for insurers operating in Qatar. The instructions relate to licensing, regulations and controls, risk management, accounting and actuaries reports. The new law stipulates that listed insurance companies must have capital greater than QAR100 mn or their risk-based capital requirement, while unlisted insurance companies must have capital higher than the figure set by the QCB.

#Takaful sector set to double growth rate

#Malaysia’s #takaful industry is set to double its growth rate this year as companies focus on selling cheaper policies in rural areas. Malaysian Takaful Association's chairman Ahmad Rizlan Azman said the number of policies would rise 10% to 5.05 million in 2016, compared with 4.3% growth in 2015. Insurers entering the micro-takaful market and the liberalisation of commission structures are the biggest drivers.

Malaysia's microtakaful expands to rural areas

#islamicfinance - #Malaysia’s #takaful industry is set to double its growth rate this year as companies focus on selling cheaper policies in rural areas, according to the Malaysian Takaful Association. The number of policies will rise 10 % to 5.05 mn in 2016, compared with 4.3 % growth in 2015 and a 1 % estimated expansion of non-Islamic business, Ahmad Rizlan Azman, chairman of the Association, said.

Zurich Insurance moves into takaful with Malaysia buy

Zurich Insurance is set to take full ownership of Malaysia's MAA Takaful after the deal received regulatory approval, giving Europe's fifth-biggest insurer a foothold in the world's second largest Islamic insurance market. MAA Group said it had received central bank approval for the sale, a deal which was first proposed in November of last year. No size for the transaction was given. MAA Takaful held 1.2 billion ringgit ($306.7 million) worth of assets as of June 2015, a 5 percent increase from a year earlier.

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