Deloitte launches the 2014 Takaful Insurance Report in Islamic Finance
- Deloitte: The global Takaful insurance regulatory environment faces challenges
- Deloitte: The global Takaful insurance market exhibited impressive 18% growth over 5 years
4 December, 2014 – Despite the global Takaful insurance market exhibiting impressive double digit growth of 18% over the period 2007-2012, the regulatory environment remains a work in progress and faces the challenge of inconsistency and conflicting interpretation across jurisdictions. An executive roundtable jointly hosted by Deloitte Middle East and IRTI-IDB Group on November 30, 2014 in Dubai brought together industry executives to debate key regulatory and investment strategies for sustainable industry growth, as well as the findings of Deloitte’s 2014 Takaful Insurance Report for Asia, Middle East and Africa, entitled ““The Way Forward for Takaful” and launched end of November 2014 as a joint research initiative in collaboration with INCEIF and Henley Business School..
Joe El Fadl, Partner in charge of the Financial Services Industry at Deloitte Middle East, commented: “Strengthening the regulatory frameworks of the Takaful industry requires focused effort and the support of all industry stakeholders. National regulators as well as industry standard-setting bodies (SSBs) are working together on initiatives to improve Takaful practices and policy-making processes. This event aimed to deepen dialogue among stakeholders on various regulatory issues and market practice challenges facing the Takaful operators.”
The day-long event was also the occasion for sharing the findings of Deloitte’s 2014 Takaful Insurance Report, which was produced by the Deloitte Islamic Finance Knowledge Center in the Middle East for the first time as a joint research initiative in collaboration with INCEIF and Henley Business School. The roundtable debated the key findings and themes of the report in three sessions – Asia, Middle East and Africa. A wide spectrum of industry representatives had the opportunity to debate the regulatory and investment strategies in these markets with heads of the AAOIFI, IIRA and other policy-makers.
“These fresh Islamic finance analytics mark the beginning of a new approach in our industry which promotes a culture of industry-driven research modelled around case-study building which is supported by global practitioners’ insights and perspectives. We are particularly delighted with the roundtable debate which cross-examined our report findings and discussed an interesting plan for the way forward,” said Dr. Hatim El Tahir, Director of the Deloitte Islamic Finance Knowledge Center in the Middle East.
Examining six key markets of Saudi Arabia, the UAE, Bahrain, Malaysia, Indonesia and Pakistan, the report identifies practice gaps and product offerings, and suggests ways to complement one another. Among the findings the study observes that Takaful product offerings and diversity of products are lacking, and that the Takaful business is by far underpenetrated in the six countries examined.
“For the Takaful industry to make an impact in the global market and be able to compete head-to-head with the big boys, Takaful firms need to move beyond the complacent area of family products into the real growth areas such as shipping and airlines, and re-Takaful. These are some of the issues tackled in the report. INCEIF is proud to be a part of this important initiative for the industry as we stay on course not only to promote new research frontiers in Islamic finance but also to promote strong university-industry symbiosis,” said Daud Vicary Abdullah, President & CEO of INCEIF – The Global University of Islamic Finance.
Professor John Board, Dean, Henley Business School, UK, added, “What this report shows is that there is a general need to increase the awareness of and need for personal insurance. If Takaful leads the way in this, then it will have achieved something remarkable.”
In addition to six key markets in the Middle East and South Asia, the report looks at Africa as an emerging niche market, particularly exploring Kenya, Nigeria and Tunisia where the Takaful industry is still in its initial stages. The joint research initiative between Deloitte Islamic Finance Knowledge Centre in the Middle East, INCEIF and Henley Business School, University of Reading was further boosted by valuable industry insight and sponsorship from FWU Group.
“The Takaful industry is well poised to expand beyond its home markets of Malaysia and the GCC. Significant untapped business potential exists in Indonesia, Turkey, Nigeria, Egypt, the Maghreb countries and Europe (UK, France and Germany). Overall this is a very timely research report and I commend Deloitte for their insightful analyses and practical findings,” said Sohail Jaffer, Deputy CEO, FWU Group.
To learn more about the Deloitte Islamic Finance Knowledge Center (IFKC) in the Middle East, go to: http://deloitte.com/ifkc
To read the full report, go to: http://bit.ly/1vNWg6P
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About Deloitte & Touche (M.E.):
Deloitte & Touche (M.E.) is a member firm of Deloitte Touche Tohmatsu Limited (DTTL) and is the first Arab professional services firm established in the Middle East region with uninterrupted presence since 1926.
Deloitte is among the region’s leading professional services firms, providing audit, tax, consulting, and financial advisory services through 26 offices in 15 countries with around 3,000 partners, directors and staff. It is a Tier 1 Tax advisor in the GCC region since 2010 (according to the International Tax Review World Tax Rankings). It has received numerous awards in the last few years which include Best Employer in the Middle East, best consulting firm, and the Middle East Training & Development Excellence Award by the Institute of Chartered Accountants in England and Wales (ICAEW).
IRTI, Islamic Research & Training Institute (IRTI), is a member of the Islamic Development Bank Group responsible for leading the development and sustenance of a dynamic and comprehensive Islamic Financial Services Industry that supports socio-economic development in Member countries.
IRTI strategic objective is to undertake research for enabling the economic, financial and banking activities in Muslim countries to conform to Islamic Shariah, provide advice, consultancy and Technical Assistance in Islamic Banking and Finance to IDB member countries, develop curricula and course materials in Islamic Finance, to disseminate research and policy findings in different fields, and develop, update and maintain information systems and databases in Islamic Banking and Finance, and disseminate them through all modern media.