Pakistan: Family takaful start-up receives largest FDI in Islamic insurance market
Source: Middle East Insurance Review | Jun 2023
5th Pillar Family Takaful, a newly licensed takaful provider, has received the largest ever foreign direct investment in the Pakistani takaful sector. The company has raised PKR2bn ($7.1m) as paid-up capital, according to the company’s website.
5th Pillar will offer family takaful products, with a special focus on Hajj and Umrah saving plans. 5th Pillar has retakaful arrangements with Hannover Retakaful Company for group life takaful plans. The operator has received an ‘A+ Stable Outlook’ IFS rating from the Pakistan Credit Rating Agency.
The Securities and Exchange Commission of Pakistan granted an operating licence to 5th Pillar in October 2021. According to information posted on the company’s website, foreign shareholders own 68% of the company and the remaining stake of 32% is held by Pakistani interests. The takaful operator is majority owned by reputed companies from Kuwait such as Kuwait International Investment Holding Company and IFA Group Kuwait.
Another sponsor of the takaful company is 5th Pillar Holding DIFC Dubai which is a special-purpose company set up by business houses from Kuwait to develop takaful companies in countries with a majority Muslim population. Starting with Pakistan, the plan is to set up similar operations in Bangladesh, Indonesia, Turkey and Egypt. M