Global: World takaful market to expand 80% to US$52.5 bln over 5 years
Source: Middle East Insurance Review | Nov 2015
The volume of global takaful business is set to reach US$52.5 billion by 2020, a growth of 80% from 2015 levels, said a report released at the 2015 Global Islamic Economic Summit in Dubai in early October.
The report, “Takaful: Global Challenges to Growth Performance and Governance”, notes that over the past 10 years, the number of takaful companies globally climbed nearly four-fold, reflecting the growing global popularity of the sector and its increasing importance to the development of Islamic finance.
“There were a total of 224 global takaful operators as at 2012, with 101 new companies formed between 2006 and 2012 alone. The total manpower supporting the primary takaful sector stood at 70,010 as of 2013,” it said. About half of the takaful operators are less than five years old, showing that Islamic insurance is an emerging segment.
The report was jointly released by Dubai Centre for Islamic Banking and Finance (DCIBF), a joint initiative of Hamdan Bin Mohammed Smart University and “Dubai the Capital of Islamic Economy”, and aafaq Centre for Research in Islamic Economy, a subsidiary company of aafaq Islamic Finance.
The report also points out that the future rate of growth of takaful is being inhibited by the relative under-development of distribution channels in several emerging markets in which takaful is being launched. “Although the global takaful industry is poised to become a massive $20 billion market by 2017, there are still critical gaps that need to be addressed by industry practitioners and experts in cooperation with government,” said the report.