Global #takaful market to gain traction as consolidation sets in
The global takaful industry is expected grow significantly thanks to consolidation and regulatory improvement in some countries. The December 2017 acquisition of Al Hilal Takaful by Takaful Emarat in the UAE has attracted international attention for the market potential of Islamic insurance, but also the obvious necessity for consolidation. In the UAE there are no less than 34 domestic and 27 foreign conventional and Islamic insurance companies touting for a customer pool of just 10.5mn people. Saudi Arabia’s insurance market is also largely fragmented, with 33 listed takaful operators competing against each other. Saudi Arabia, the UAE, Bahrain, Oman and Qatar already introduced new regulations specific to the takaful industry, while Kuwait has a new insurance law draft. The Gulf Cooperation Council (GCC) is the largest market for takaful industry, the second-largest chunk is mainly spread over Malaysia, Indonesia and Brunei. The future potential of takaful in the GCC is certainly driven by the reduction of state benefits which increases demand for products such as life and health insurance.
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