IslamicFinance.de

The first ever Islamic re-insurance is expected to be launched this year as the Kenya Reinsurance Corporation ventures into Sharia-compliant business. The Capital Markets Authority says in its new 10-year master plan that Kenya Re has the potential to provide a regional platform for this product since it has presence in West Africa and Middle East markets. The master plan has also proposed for the creation of a regulatory framework for Islamic capital markets focusing on corporate governance, disclosures, a policyholder compensation fund and responsible pricing. The CMA has in addition proposed the development of a separate policy, legislative and regulatory framework for Islamic products and services covering Islamic financial institutions, financial regulators, Islamic groups and the Ministry of Finance. This policy will run parallel to the conventional Act.

Kenya Reinsurance Corporation ( Kenya Re) is one of several local firms to venture into the Islamic re-insurance business with establishment of a Sh50 million Re-Takaful (or Sharia compliant reinsurance) window. Managing Director Jadiah Mwarania said demand for Shari’ah-compliant products has been growing and Kenya Re is seeking to ensure it retains existing business and expand into new markets. Kenya Re also launched a newly appointed board that would guide, monitor and supervise the new venture to ensure compliance with Sharia rules and principles. Mwarania expressed confidence that rekakaful would enable Kenya Re increase market share and attain financial growth.

The Kenya Reinsurance Corporation is planning to venture in sharia-compliant business and confirmed that it will start ReTakaful insurance in the country and the areas where it already has a presence in West Africa and the Middle East markets. According to the firm’s managing director, Mr Jadiah Mwarania, the development is part of Kenya Re’s 2013-2017 core strategic areas that touche on market expansion and development of products. The firm elected a sharia-based supervisory board last year to advise the firm on acceptable aspects of the ReTakaful.

In preparation to assume risks of firms offering Islamic Insurance cover known as ReTakaful, Kenya Reinsurance Corporation (Kenya Re) has decided upon a Sharia board. This way, the establishment of a dedicated ReTakaful window has been brought closer within the corporation. The board of Muslim scholars and people conversant with the Quran will contribute to the preservation of Kenya Re's responsiveness to requirements of its clients and to its development of solutions that satisfy the takaful industry demands for Sharia-Compliant reinsurance services.

Kenya Reinsurance Corporation is searching to raise its revenue growth to more than the 13% it enjoyed in the first half of this year by diversifying into the Islamic space.
The fact that in East Africa a Shari'ah compliant reTakaful operation will be launched, should let Kenya Re trap the business of Kenya's Takaful Insurance of Africa, as well as that of conventional insurers that have opened up Islamic windows, such as Canon Assurance.

Kenya Reinsurance Corporation plans to venture into Sharia-compliant business to grow its income and tap into the expanding Islamic finance in Africa and the Middle East where it already exists.
At the Bomas of Kenya Mr Mwarania, Kenya Re's chief executive officer, declared that the company will additionally venture into microinsurance and political risk insurance.