Career gif Global Takaful Market $bn


$7 $8


$5 $6


$4


$2 $3


$1 $0


2.10 2.42 2.78 3,19 3.67 5.59 4.22 4.86 7.39 6.42


1. Al-Gharar (Uncertainty) 2. Al-Maisir (Gambling) 3. Riba (Interest)


2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source courtesy of Celent.com Comparing Takaful to Conventional Insurance Issue


Value Proposition


Laws Capital Ownership


Conventional Insurance


Profit for shareholders/ Risk transfer mecha- nism


Secular/Regulations Shareholder provided Shareholders


Management Profetional Manage- ment


Investments Equity/debt with no restrictions


Surplus Source: Takaful Ta`Awuni.Bank Al Jazira,2002


Takaful potential, year 2015 Takaful premium US $7.4bn


Total insurance premium $1.1 trillion selected countries only


Saudi Arabia Indonesia Malaysia


Csd`pt U & C USA


UK Kuwait


China Jordan Qatar Algeria


India Pakistan


South Africa Oman


Singapore


Tunisia Bahrain Lobanon


Libya Turkey


Morocco Philippines


Syria


128 128 192


128


91 95


18 20 30 33 37 45 64 65 76


11 12 14


200 400 600 800 1000 Source: Courtesy of Islamic Banking and Insurance 2010 October Global Islamic Finance 57 1200 1400 853 Iran 480 467 260


Different countries have various markets for Takaful and if you are considering a career in Takaful you could investigate the potential market. Malaysia has the largest market for Takaful premiums reaching 1,220 whilst Syria has the smallest market. The chart below shows the Takaful potential for 2015 in selected countries around the world to give you a better idea of the emerging Islamic insurance market.


Twenty-seven countries were selected where most of the demo- graphic and insurance statistics was available. It was estimated that the global takaful premium could be in the region of US$7.4 billion in 15 years’ time, growing at nearly 20% per annum.


This is not an unachievable task when we have Malaysian takaful business growing at 60% pa and the Middle East at 10%. With concerted effort on part of the Takaful operators worldwide, a growth of 20% pa should be very much possible.


776


1200 1220


936


Takaful Insurance


For benefit of participants


Sharia/Regulations Operator provided Participants Operator


Sharia-compliant equities/products


Shareholder`s account Participant`s account, fee for operator


There are three (3) models and several variations on how takaful can be implemented.


1. Mudharabah Model 2. Wakalah Model 3. Combination of both


(Information from Wikipedia) The source above shows a clear view of the basic models and vari- ations in which takaful can be implemented in comparison to con- ventional banks so that you can clearly see the difference between the two and ways which you can implement Takaful growth.


Growing Opportunities in Takaful Insurance The graph below shows the global Takaful market which has in- creased potential for employees, students and professionals who want to tap into the Islamic insurance industry.


The graph spans from the year of 2006 which shows that the mar- ket for Takaful was at $2.10 billion dollars, however the demand for Takaful insurance has increased year by year and is expected to reach $7.39 billion dollars by 2015 if it maintains growth in the highly competitive financial insurance industry.


“The potential for takaful is enormous given that insurance pen- etration in most Islamic countries does not exceed 1% of gross domestic product,” says Catherine Stagg-Macey, senior analyst and author of the report. “Many of the challenges facing takaful operators are strategic. This market is trying to establish itself. While skills and resources can be borrowed from conventional insurance markets, there is significant investment required creat- ing the business.”


The takaful market is still in its formative stage in 2010, however, it is reported that market projections estimate growth rates be- tween 15% and 20% over the next 10 years and they are set to reach US$7.4 billion in premium by 2015. With challenges around customer service and productivity, technology can enable this growing industry through its formative stage.


cial insurance is strictly not allowed for Muslims as agreed upon by most contemporary scholars because it contains the following elements:


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