GCC is leading insurance race

MANAMA: The GCC as the heart of the global takaful market, with accepted contributions of more than $1 billion as compared to global contributions of $2bn in 2006, a report says.

Of the world total of 133 takaful operators, 59 are within the GCC, Ernst & Young's inaugural World Takaful Report 2008 says.

The report also forecasts that accepted contributions globally would rise to more than $4.3bn in 2010 and that the 20 per cent growth rate of the industry would be maintained.

The report was unveiled at the annual World Takaful Conference 2008 in Dubai.

Findings indicate that growth in the takaful sector has outpaced that in conventional insurance sectors in most countries of the Middle East.

General takaful, which includes property and miscellaneous accident takaful, currently accounts for approximately 50pc of written business globally and in the region.

The drivers of takaful demand include high economic growth and increase in per capita GDP, a youthful demography, increasing awareness, a greater desire for Sharia-compliant offerings and increasing asset based, Sharia-compliant financing.

"It is clear that there are significant growth opportunities for the takaful industry, especially when the estimated global insurance premiums are as high as $3.7 trillion," said Ernst & Young Middle East managing partner audit and assurance business services Noor Ur Rahman Abid.

Despite significant challenges, the outlook for the takaful industry has enthused the Islamic finance world, according to Ernst & Young's head of Islamic finance services group, Sameer Abdi.