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Allianz SE believes that it is not economically viable to enter into Malaysia's domestic takaful market just yet, board member Manuel Bauer said. He believes that growth in the Islamic insurance sector is beginning to cool down and would therefore be a struggle to justify any major investments to its shareholders. Bound by Bank Negara Malaysia's restrictions that caps foreign ownership at 70% in a local insurers, he said, Allianz's is answerable to its shareholders if it decides to take certain acquisition risk. Bauer also argued that the domestic takaful market has been stagnant and not performing as well as one thought it to be. Bauer said that taking into account Allainz's position in Malaysia as market leaders in both life and general business, the takaful potential figures are not convincing.

Managing Director of Egyptian Takaful Company (Life) GIG Hisham Abdel Shakour revealed that the company plans activating marketing its products through Audi and Abu Dhabi Islamic banks by October. Abdel Shakour explained that GIG obtained the initial approval of Egyptian Financial Supervisory Authority ( EFSA ) to start activating its various products via the two banks' branches along with obtaining the approval of the Central Bank of Egypt (CBE). GIG is still waiting EFSA 's final approval to activate this new marketing activity in Egypt, Abdel Shakour added. The company is planning promoting new five products according to the new marketing system as it contributes to facilitate for the customer to obtain automatically policies with high speed.

AIA Public Takaful Bhd has declared a total surplus of RM8.5 million for the financial year ended Nov 30, 2013. In a statement, the insurance company said the surplus distribution will involve more than 36,000 certificates under AIA Public, marking the first surplus distribution since the company’s inception three years ago. The distribution will benefit eligible customers who had participated in Takaful products offered by AIA AFG Takaful Bhd and ING Public Takaful Ehsan Bhd, the two companies which had integrated their businesses in March 2014 to form AIA Public. AIA Public said the surplus will be distributed to those who are registered as a customer of AIA Public as at Nov 30, 2013, do not have any outstanding contribution payments and have not made any claims.

Abu Dhabi-listed Islamic insurer National Takaful Co (Watania) said on Tuesday that United Arab Emirates regulators had approved the sale of 60.53 percent of the firm to MB UAE Investments and an affiliate of MB. Watania said MB UAE Investments would acquire 51 percent and Al Madina Insurance Co would take 9.53 percent. The group would buy a total of 90.8 million shares. The deadline for the purchase is next Feb. 24, Watania said in the statement. It did not give details such as the purchase price or who would sell the shares. In a separate filing on the Oman bourse, however, Al Madina said it would buy 14.3 million Watania shares for 17.88 million dirhams ($4.87 million), implying it would pay 1.25 dirhams per share.

Malaysia’s 11 takaful companies should consider merging soon, especially in the general takaful business due to potential limited growth prospects in addition to insurmountable competition especially with the upcoming detariffication of motor and fire insurance in 2016. Apart from new regulatory requirements like the Islamic Financial Services Act 2013 which many companies have difficulties to comply with, takaful products have failed to differentiate itself from conventional insurance products. In addition, limited product offerings by takaful makes conventional insurance more attractive. Nonetheless, other than the regulatory aspects, the synergy offered by a merger would make the company more competitive in addition to having more products to offer.

L’assurance islamique, dite “takaful”, débarque en Algérie grâce à la compagnie Salama Assurances Algérie. La compagnie algérienne prévoit de lancer des produits d’assurance islamique, soit l’équivalent de la mutualité, dans un proche avenir, comme l’a indiqué Abdelhakim Hadjou, son directeur général. Selon ce dernier, le fait que la législation algérienne n’encadre pas encore ce type d’assurances ne sera pas un frein à la commercialisation de ce service. Il peut y avoir dans les mois à venir un intérêt. On a même parlé de cela au Parlement avec la participation des banques. Il y a eu débat sur l’opportunité de légiférer sur le takaful, a-t-il ainsi déclaré.

Moody's Investors Service, has today affirmed the Ba1 insurance financial strength rating (IFSR) of National Takaful Insurance Company K.S.C., based in Kuwait. The rating outlook was changed to stable from positive following the decline in the shareholders' and policyholders' (consolidated) equity in 2013. Moody's Ba1 rating reflects National Takaful's good position, with a top-three market share in the domestic Takaful market. The rating affirmation also reflects the recent improvement in underwriting profitability. This has restricted further deterioration in the policyholders' fund. However the change in outlook to stable from positive reflects the decline in consolidated equity.

A Takaful insurance operator is to strategically consider the maturity matching approach as an investment mechanism in dealing with liquidity issues of the business at hand. Moreover, the issue of distribution of surplus in Takaful comes only after fulfilling or meeting the Shariah obligation of helping participants who have become victims of various risk crystallization. The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) brought out a valid suggestions on adopting the principle of Iltizam bil Tabarru (pledge or commitment to donate). This gives the participants the ownership rights over the scheme while still having the firm commitment of mutual assistance (Ta’awuni) on the premise that a balance, if any, will be returned by the fund manager for distribution between the donating participants or owners of the fund in proportion to their initial contribution.

Alpha Capital Holding (AC) has been chosen to manage Wethaq Takaful Insurance - Egypt's launched-to-be mutual fund. Wethaq's planned fund will be at an initial capitalisation amounting to EGP 50 million. It is expected to be launched in local markets within the next three months. The Egyptian Financial Supervisory Authority (EFSA) has recently given its regulatory approval for the launch of six open-ended mutual funds by insurance companies, with total capitalisations worth EGP 450 million. Wethaq is currently completing the regulatory procedures required to launch its mutual fund. The fund's investment objective is to provide a savings and investment pool in order to give daily liquidity through accumulating daily returns on the fund's investments.

The Chairman of Islamic insurer Abu Dhabi National Takaful Co. (Takaful) resigned on Tuesday, according to a statement on the Abu Dhabi bourse. No explanation was giving for Khadem Al Qubaisi’s resignation. He has been replaced by Vice-Chairman Khamis Buharoon. Nasser M. Al Murr Al Za’abi has filled the vacated board seat, according to a separate statement on the bourse. Last month, Takaful reported a nearly 25 per cent drop in second quarter net profits. The company made Dh15 million in net profits for the three months ending June 30. Takaful said the fall in net profits was largely due to the increase in net claims incurred in the motor line of business. Earlier, Al Qubaisi was reported to have said that Takaful is in the process of obtaining an international financial rating.

Pakistan’s second largest life insurance company informed members of the Karachi Stock Exchange (KSE) on Friday that it intends to enter the window Takaful business. The board of directors of EFU Life Assurance has approved changes in its memorandum of association under Takaful Rules 2012 to launch Takaful. The Securities and Exchange Commission of Pakistan (SECP) replaced Takaful Rules 2005 with Takaful 2012 two years ago, which allowed conventional insurance companies to set up Islamic windows to conduct shariah-compliant business. EFU Life Assurance is not the only company that has shown interest in setting up Islamic window operations. Jubilee Life, the largest player in the life segment in terms of gross premiums, is also eyeing the Shariah-compliant business after the implementation of Takaful Rules 2012.

THE government has been advised to look into the possibility of enacting a law to regulate establishment and operations of Takaful in the country. The Commissioner of Insurance, Mr Israel Kamuzora, said this in Dar es Salaam recently when briefing the Minister of State in the President’s Office (Special Duties) on the activities of the Tanzania Insurance Regulatory Authority (TIRA). He said the proposed law would provide guidelines in establishment and operations of insurers providing services that are in compliance with Shariah - Takaful. In Tanzania only few banks including the National Bank of Commerce (NBC), Amana Bank, People’s Bank of Zanzibar (PBZ) and KBC Bank offer Shariah compliant services. The Minister for Finance, Ms Saada Mkuya Salum, last month encouraged more local banks to provide Shariah compliant banking services to attract more Muslim customers.

EFU insurance group will offer shariah-compliant insurance products in Pakistan through its general and life units. Both EFU Life Assurance and EFU General Insurance plan to open takaful windows. The plans come two months after regulators cleared the way for conventional firms to offer Islamic products, part of regulatory effort to increase insurance penetration in Pakistan. EFU General had Rs13.9 billion ($140.8 million) in written premiums in 2013, representing roughly a quarter of the industry’s total. EFU Life has a branch network of over 150 branches around the country. A source at one of the units said the takaful windows could be operational in two to three months.

EFU Life Assurance and EFU General Insurance, Pakistan's largest private insurance group, will offer sharia-compliant insurance products through takaful windows. The plans come two months after regulators cleared the way for conventional firms to offer Islamic products, part of regulatory effort to increase insurance penetration in Pakistan. Company officials declined to comment on their plans but a source at one of the units said the takaful windows could be operational in two to three months. The Securities Commission had earlier said it had received five applications for takaful windows and expected as many as half of all conventional insurers in Pakistan to eventually apply for a licence.

Saudi Arabia's crowded insurance sector is set for consolidation amid low penetration rates and rising costs, highlighting the difficulties for smaller firms in the industry to maintain market share or grow their business. The Saudi market remains dominated by compulsory products, with medical and automotive insurance accounting for well over 75 percent of all gross written premiums. Other products such as personal health or life coverage make up only a fraction of total policies issued and premiums written. However, penetration rates across GCC member states could double by 2017 thanks to longer life expectancies and compulsory health insurance programmes.

Some GCC regulators have recently proposed a host of new takaful-specific regulations that are expected to boost the market access of these companies. Many of the new regulations relate to the implementation of more stringent corporate governance requirements such as board level investment committees, internal audit departments and approved actuaries. Transparency, a key deficiency in the GCC insurance markets, will also improve with periodic (quarterly, bi-annual and annual) and early warning reporting. In many GCC countries, authorities have sought to protect consumer rights through the mandatory purchase of certain insurance covers. The increasing regulation of the insurance market is expected to help to stabilise the market's volatility and further encourage market growth.

Fitch Ratings has upgraded Luxembourg-based ATLANTICLUX Lebensversicherung S.A.'s (ATL) Insurer Financial Strength (IFS) rating to 'BBB+' from 'BBB'. Moreover, its Long-term Issuer Default Rating (IDR) was upgraded to 'BBB' from 'BBB-'. The Outlook is Stable. At the same time Fitch has upgraded ATL's SQ ReVita Value of Business In-Force transaction and its Salam III Sukuk (Islamic bond) programme to 'BBB' from 'BBB-'. The upgrade reflects ATL's track record of strong profitability, low investment risk and its strong capital position. However, these positive rating factors are partly offset by ATL's dependence on unit-linked products and its fairly small size.

Sheikh Abdullah Salem Al Salmi, executive president of the Capital Market Authority of Oman, said the Islamic insurance law is in the last stages of completion.

The spread of Islamic trade finance is boosting demand for Shariah-compliant reinsurance in the Gulf, trade credit insurer Euler Hermes says, predicting the sector could eventually account for over a third of its business in the region. Euler Hermes, part of Germany’s Allianz insurance group, is involved in the business because it is one of the region’s biggest trade credit insurers. The company launched a Shariah-compliant trade credit insurance product in 2008 and the business began growing substantially three years ago, now accounting for about 10% of Euler Hermes’ total GCC business. Euler Hermes’ GCC operations had total turnover exceeding $40mn last year, and exposure to its clients of more than $12bn.

Shaikh Abdulmalik bin Abdullah al Khalili, Minister of Justice, has officially launched the first full-fledged Islamic insurance in the country called Takaful Oman, in the presence of Sayyida Rawan Ahmed al Said, Managing Director and CEO of Takaful Oman Insurance Company, Ahmed Ali al Mamari, Acting General Manager, Directorate of Insurance Supervision, CMA, and a number of dignitaries and senior executives from various sectors at the InterContinental Muscat. Al Madina, which has a customer base of 37,000 policy holders, expects the market to grow between RO60 million to RO70 million in worst case scenario and RO150 million to RO180 million in best case scenario in the next three to five years.