Dow Jones Indexes to launch Takaful Index

Dow Jones Indexes is expanding its Dow Jones Islamic Market Indexes series by launching the Dow Jones Islamic Market Global Finance & Takaful Index, which measures the performance of financial services stocks that pass rules-based screens for Shari’ah compliance.
The new index, designed to provide broader coverage of the Shari’ah-compliant financial services sector, will serve as a benchmark and an underlying instrument for investment products such as mutual funds and exchange-traded funds (ETFs).


“The Dow Jones Islamic Market Indexes is a unique series that combines faith-based principles and benchmarking,” said Michael A. Petronella, president, Dow Jones Indexes. “Our index family was the first to market and has clearly set the standards of Islamic indexing around the world. And, once again, with the launch of the Dow Jones Islamic Market Global Finance & Takaful Index, we are providing the market with the first benchmark of its kind for these combined sectors.”


Eligible companies are banks, insurance and financial services companies. Included in the index are those stocks that pass financial ratio screens that are less than 33 per cent in total debt, divided by trailing 24-month average market capitalisation; cash plus interest-bearing securities, divided by trailing 24-month average market capitalisation; and accounts receivables, divided by trailing 24-month average market capitalisation.


The dollar-denominated Dow Jones Islamic Market Global Finance & Takaful Index is weighted based on float-adjusted market capitalization, with the weight of individual stocks restricted to 15 per cent. The index composition is reviewed quarterly in March, June, September and December; it is also regularly reviewed to account for corporate actions such as mergers, de-listings or bankruptcies.

Courtesy by: CPI Financial

Niger insurance urges public to buy Takaful insurance products

The management of Niger Insurance plc has enjoined members of the insuring public to buy Takaful insurance products as part of efforts to imbibe savings culture.

The company’s Managing Director, Clinton Uranta, made this call during a chat with correspondents in Lagos.

Unlike the conventional insurance which majority of the Shariah scholars believe is unlawful due to involvement of Riba (interest), Maisir (gambling) and Gharar (uncertainty), Takaful, the Islamic alternative to insurance, is based on the concept of social solidarity, cooperation and mutual indemnification of losses of members.

It is a pact among a group of persons who agree to jointly indemnify the loss or damage that may be inflicted upon any of them, out of the fund they donate collectively. The Takaful contract so agreed usually involves the concepts of Mudarabah, Tabarru´ (to donate for benefit of others) and mutual sharing of losses with the overall objective of eliminating the element of uncertainty.

Uranta said the people should not see the takaful products as religious products especially as the bottom line is savings, which can either be savings for school fees, pilgrimage, house rent or any other thing.

While pointing out that takaful is not new to insurance industry globally as it is also being offered by many insurance companies globally, he said the product has been doing very well since it was introduced by Niger Insurance.

A large number of Takaful companies exist in the Middle East, Far East, Iran, Turkey, and Sudan and even in some non-Islamic countries. There are over 60 companies offering Takaful services in 23 countries around the world.

“In our own unique way, we have expanded the product in such a way that even non Muslims embrace it. But the bottom line is savings. Savings for school fees pilgrimage, house rent and what have you. That was how we modified it to suit our people in Nigeria. So you asked me whether it is doing well, it is doing well and we will continue to bring innovation into it to make it more attractive to the insuring public,” he stated.

Uranta also spoke on the branch expansion and restructuring programmes embarked upon by the company, saying the firm now has two additional regional offices in Sokoto and Yola to increase its total outlets to 45, while efforts are ongoing to open more new branches in the nearest future.

He also hinted that the insurance outfit has set a premium income target of N 12 billion for itself in 2011 based on the fact that the economy is on the recovery path, coupled with the fact that the company recently made new appointments and embarked on internal restructuring.

Niger Insurance Plc is a public quoted composite insurance company. The management team of the company is made up of trained, experienced and competent professionals with extensive management and technical skill.

Niger Insurance is fully computerised with the most advanced software technology. The computer network is capable of expansion and upgrading to meet with present and future increases in the volume of business.

The company has also put in place sound reinsurance treaties with local and foreign first class reinsurance companies led by Swiss Re. These comprehensive securities ensure financial stability and exude confidence in its service to both present and prospective customers.

Courtesy by; Vanguard

Islamic insurance firm sees opportunity after Egypt crisis

DUBAI: Tokio Marine Middle East, an Islamic insurance services provider, sees an opportunity to expand its business in Egypt following the recent political turmoil, the company’s chief executive told Reuters.


Islamic insurance, or takaful, is already seeing demand in Egypt and the recent demonstrations will highlight the need for financial protection, said Ajmal Bhatty, president and chief executive of Tokio Marine Middle East, a unit of Tokio Marine Holdings.


“The awareness for insurance, especially personal insurance is generally low in regional markets including Egypt,” Bhatty said in an interview last week.


“Events such as the recent ones generally result in increasing the awareness in people that they need to do more about protection of their livelihood and assets.”


The unprecedented demonstrations captivated the world and led to the ouster of President Hosni Mubarak after a 30-year reign.


Tokio Marine launched two takaful companies in Egypt in January 2010. There are eight Islamic insurance providers in the country.


Bhatty said the industry expects to pay claims resulting from the turmoil.


The Japanese insurer said last year that it expected the two sharia-compliant units to generate about $3.5 million in annual premium income in the first financial year, which closes in June. That figure should increase to $136.4 million within 10 years, giving the Egyptian operations more than a one-fifth share of the takaful market in the country.



Islamic insurance, or takaful, is similar to mutual insurance but with a clear segregation of the assets owned by policy holders and those owned by the insurer.


The industry is expected to be a clear growth driver within the nearly $1 trillion Islamic finance industry over the next five years.


Tokio Marine is also considering launching micro-takaful operations in Egypt to complement microfinance programs already available.


Micro-takaful is an Islamic insurance scheme for people on low incomes who cannot afford insurance premiums. As part of a micro-credit scheme, a small amount goes to cover areas such as life, disability and accident insurance, as well as livestock cover or crop insurance against hazards of severe weather or flooding.


Bhatty said the company has already successfully provided conventional micro-insurance in India through a joint venture with a Japanese fertilizer company.


“We would like to explore microtakaful possibilities for Egypt as a good proportion of the society would benefit from it,” Bhatty said.

Courtesy by: Reuters

Malaysia AIA AFG Takaful seeks new hires, eyes growth

The insurer, is owned by the Malaysian unit of AIA and Alliance Bank , will add to its current headcount of 25 as it looks to become among Malaysia's top three family takaful providers within three years, its chief executive Wan Azman Wan Mamat said.

"The potential is that immediately a start-up company like AIA AFG Takaful will have access to a very strong distribution and that will be the differentiator for the company in terms of the growth potential," AIA Bhd chief executive Khor Hock Seng told reporters after officially launching the company.

Wan Azman said Etiqa Takaful, which is owned by Mayban Fortis, a joint-venture between Malaysia's largest lender Malayan Banking and financial group Fortis , is Malaysia's biggest Islamic family insurer with about 25 percent market share. Prudential is second with about 16-18 percent share.

"Increasingly bancassurance is going to play a major part of our business," said Alliance Financial Group's group chief executive Sng Seow Wah.

"With this tie-up, I hope to be able to extend beyond the takaful business with AIA to do other bancassurance products which will extend to businesses."

The Islamic insurance industry's growth has been held back by a shortage of sharia-compliant instruments that insurers can invest in and some doubts about whether takaful really complies with Islamic guidelines.

The takaful penetration rate in mostly Muslim Malaysia was only 10.9 percent in September 2010. The Southeast Asian country has the world's second-largest takaful market and its total assets of $3.2 billion accounted for 26 percent of total global takaful assets in 2009, according to central bank estimates.

AIA AFG Takaful is one of four takaful companies that received licences from the Malaysian central bank late last year as the authorities look to accelerate the industry's growth.

Total takaful contributions could reach $7.7 billion a year by 2012, Ernst & Young has forecast. But global takaful contributions are less than 1 percent of the total insurance premium spend annually, industry lawyers Clyde & Co have said.

Courtesy by: Reuters

TOP REGIONAL AWARD FOR TAKAFUL COMPANY

MANAMA: Solidarity General Takaful company has won a top regional award at a ceremony held in Dubai. It was named Bahrain Insurer of the Year and for the second time running was named the best Takaful Insurer of the Year at the MENA Insurance Awards Ceremony.

Solidarity General Takaful is a subsidiary of one of the largest Takaful groups in the world, Solidarity Group Holding.

The MENA Insurance Awards are hosted by MENA Insurance Review magazine, an authoritative and highly-regarded business title that has become a key feature in the region's insurance event calendar.

The awards recognise Solidarity's commitment to its customers, as well as the company's innovation and quality in its product offering, its strong financial positioning in its core insurance business and its success in building a solid platform for further growth.

"We are delighted to have been named Bahrain Insurer of the Year and for the second consecutive year the best Takaful Insurer," said Solidarity chief executive Ashraf Bseisu.

"The awards serve to further reinforce our long-standing commitment and drive to better serve our clients, to whom we owe these awards in the first place," he said.

"The awards are a reflection of the high level of recognition that Solidarity has attained, amongst both its peers and its clients, as both a leading insurer in Bahrain and a leading Takaful insurer in the region," said Mr Bseisu.

"The fact that we have been singled out for these two prestigious industry awards is something we can all be justifiably proud of," he said.

"The awards are all the more significant because it is based in large part on our ability to demonstrate a strong commitment to our customers," said Mr Bseisu.

"This ability is a direct consequence of the devotion, dedication and world-class expertise of every member of the Solidarity team," he said.

Courtesy by: Gulf Daily News

Takaful International goes online

MANAMA: Bahrain-based Takaful International, the pioneering takaful company in the region, on Sunday embarked on a new journey by introducing first of its kind service in Bahrain called e-takaful.

Being the first takaful company to offer on-line services at its portal www.etakaful.bh will immediately benefit both individual and corporate clients.

Announcing the innovative step, Essam Al-Ansari, general manager, during a press conference held at Takaful House in Seef District, said the company would continue to lead the way in takaful segment.

“We are just days away to kick start company’s branch operations in Doha, thanks to the company’s leadership and vision of the management to reach out all potential markets in the GCC,” Al-Ansari said.

“Everything is put in place for Doha operations and we just awaiting the license to open the first-ever Takaful International’s branch outside Bahrain,” he added.

“We have noticed the markets need for technologically advanced services that provides an effective, safe and easy insurance service process,” said Al-Ansari, who was joined by A. Aziz Al-Othman, deputy general manager and Ali Ebrahim M. Noor, deputy general manager family Takaful, healthcare and Takaful centers.

“The company continues to innovate and improve all its insurance products and services in order to ease all procedures for customers and keep pace with the current era” he added.

Abdul Aziz Al-Othman, deputy general manager of the company, said that the clients can obtain quotations for various services such as car, travel, home, domestic and marine insurance and other insurance services.

“It is also possible to obtain the documents electronically for renewal of all policies; with the possibility of reporting of claims as well as customer suggestions are welcome. Further features allow review of policies and claims and for updating personal data,” he added.

In addition, the customers can retrieve policy quotes in few minutes, by filling the form of the insurance service, and paying the premium through a protected Web page; after completing the form all data will be sent and the policy will be delivered to the insured in no time by express mail service (private) in any place within Bahrain.

“The Kingdom of Bahrain is at the top of the ladder of in terms of Internet penetration in the Middle East and the study indicates that percentage of Internet users have exceeded 32 per cent which is around 435,000 users. We strive to continue to provide the best services to our customers and this website is developed to serve them promptly and effectively, in addition to saving time and effort,” he added.

“As a lot of salvage coming out in many areas of takaful services, the customers can also benefit from out e-bidding portal by using online services and get the information of bidding even through SMS,” added Ali Ebrahim Noor.

Takaful International Company founded in 1989 offers variety of insurance coverage which is in line with the foundations of the Shariah and meets the requirements of this age. The company has received BBB rating with a long-term stable outlook from the Standard & Poor’s.

Courtesy by: Arab News