Takaful (Islamic Insurance) industry has grown in high double digits across the Gulf Cooperation Council (GCC) in recent years according to the Global Takaful Report 2017, released at the World Takaful Conference recently.
In terms of gross written contribution (GWC) equivalent of gross written premium in the conventional industry, the GCC markets grew by a compounded annual growth rate (CAGR) of 18 per cent during 2012 to 2015 period. While South East Asia reported a negative growth of 4 per cent due to currency depreciation, Africa reported a CAGR of 19 per cent during the same period.
“Regulatory reforms across several African markets along with large uninsured population are helping high growth rates across several countries in the continent. In terms of GWC, Saudi Arabia is the largest Takaful market with a GWC of $9.7 billion (Dh35.62 billion) in 2015. Saudi market is dominated by general insurance with limited life insurance business,” said Safder Jaffer, Managing Director & Consulting Actuary — Middle East & Africa, Milliman, an actuarial and consulting firm that prepared the report.
GCC markets continue to dominate general Takaful whereas South East Asia continues to dominate life Takaful. GCC had an overall market share of 88 per cent of general Takaful market in 2015. Saudi Arabia and UAE reported the strongest growth in general Takaful in 2015 with 20 per cent and 19 per cent growth in total contributions, respectively
In the GCC, family Takaful achieved a record growth of 34 per cent in 2015 in total contributions mainly as a result of high growth in the UAE driven by the introduction of compulsory health insurance in Dubai. “There are significant growth opportunities for family Takaful in GCC given current low penetration rates,” Jaffer said.
Global Takaful GWC is estimated at $14.9 billion as at the close of 2015. There is strong growth in overall global Takaful market in the range of 13 to 14 per cent per annum. The split of the family and general Takaful market in 2015 is approximately 17 per cent and 83 per cent respectively.—Agencies