In Summary
To be eligible for the surplus, policy holders must have taken a policy in 2012, don’t have outstanding premium payments and have not made any claims.
Plans are in place to enter Somalia, Uganda and Tanzania by the end of this year.
Policyholders of Sharia-compliant insurer Takaful who did not make any claims on their covers last year are set to receive pay cheques totalling Sh11 million.
Takaful Insurance of Africa announced the payouts Tuesday as it also revealed plans to enter new regional markets.
The insurer will share out the proceeds from its underwriting profits made in 2012 from general insurance business in line with Islamic laws on covering risks.
This is the second payout to policy holders following last year’s distribution of a Sh15.6 million surplus.
To be eligible for the surplus, policy holders must have taken a policy in 2012, don’t have outstanding premium payments and have not made any claims.
Hassan Bashir, chief executive of the company, disclosed that last year the highest amount received by a policy holder was Sh254,000 while the lowest earned Sh1,000.
Takaful was licensed in March 2011 by the Insurance Regulatory Authority (IRA) as a composite Sharia-compliant insurer.
The company saw its gross surplus double to Sh53.7 million in the year ended December 2012 compared to Sh26 million a year earlier; buoyed by gross underwritten premiums that grew more than two-fold to Sh428.2 million in the period.
Plans are in place to enter Somalia, Uganda and Tanzania by the end of this year. The practice of distributing a portion of surpluses to eligible policy holders is one of the defining features of Sharia-compliant insurance, which Takaful said it would take advantage of to attract new business.
READ: Sharia insurer gets approval to underwrite life policies
"Takaful (Islamic insurance) involves a mutual co-operation between members of a pool who safeguard each other against defined risks and share the surplus where the fund is profitable," said Mr Bashir.
Mr Bashir said the company will invest Sh87 million ($1 million) to launch operations in Somalia in the next two months, and is awaiting regulatory approvals to enter Uganda and Tanzania.
"We have a licence to begin operations in Somalia. We have already studied the market, trained staff and put together a team to open in four regions of Somalia."
"We are awaiting regulatory approvals to enter Tanzania and Uganda," said Mr Bashir, adding that the firm has a Sh430 million ($5 million) budget to set up in each of the two markets.
Kenya is emerging as the region’s Islamic financial services hub, with two fully-fledged Islamic banks, and re-insurers such as Kenya Re offering re-takaful and a number of lenders such as Barclays, Standard Chartered, KCB, National Bank, Chase offering Sharia-compliant banking products.
Source Business Daily
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