The Islamic Insurance Conference is to be launched on Sunday in Abu Dhabi with Arab and International participants

: 3/5/2015

The Islamic Insurance Conference is to be launched on Sunday in Abu Dhabi with Arab and International participants

 

 

Al Zaabi: There are AED3 billion worth of investments, AED2.3 billion of capital, and 11 Takaful Insurance companies operating in the UAE

 

Abu Dhabi, March 4, 2015

The Islamic Insurance Conference proceedings will be launched in Abu Dhabi on Sunday (March 8, 2015) under the patronage of H. H. Sheikh Mansour bin Zayed Al Nahyan, Deputy Prime Minister and Minister of Presidential Affairs. The expected participants include Islamic insurance makers, financial and investment institutions, insurance experts, and jurisprudents of Islamic financial transactions at the level of the UAE, the region, and the world.

 

According to H. E. Ebrahim Obaid Al Zaabi, Director General of the Insurance Authority, the conference (which will be organized by the Insurance Authority at St. Regis Hotel in Abu Dhabi) comes at a critical stage in the development of the Islamic insurance industry worldwide. The ongoing development of the industry means that decision makers must capture the components that has currently lead to growth in the industry and examine the prospects of further development in the medium and long term. Growth can thus be achieved by providing the current and future prerequisites that will ensure the sustainable growth of the industry, which has recently widely penetrated global markets.

 

Al-Zaabi added that the organization of this international conference comes at a time where the Islamic insurance industry in the UAE, the region, and the world has seen significant growth and penetration. This is perhaps due to the rising demand for this type of insurance by large segments of clients in markets around the world.

 

He pointed out that the IIC derives its huge importance from the issues and matters that it will discuss over two days. It is also important due to the participation of a selection of insurance company CEOs and Islamic Law jurisprudents specialized in the area of regional and global financial transactions. In addition, the event will be attended by organizations and specialized Arab and Islamic financial councils.

He announced that scholars from Al-Azhar Al-Sharif and Sharia boards working in Arab and Islamic countries will participate in the conference, along with supervisory bodies from Arab countries and national, Arab, and international insurance companies.

 

Al Zaabi asserted that the UAE’s Takaful insurance industry has achieved significant growth in recent years, at a time where the Emirati insurance market has become one of the largest insurance markets in the Arab region in terms of the number of written premiums. He indicated that the protection of the rights of policyholders, clients, and the beneficiaries of insurance policies is a top priority for the Insurance Authority, which seeks to establish a balance in the rights and duties across all parties to the insurance process.

 

He added that the number of Emirati Takaful insurance companies has increased to 11, with a total capital of nearly 2.3 billion Dirhams. The total figure invested in Takaful insurance companies increased to approximately 3 billion Dirhams at the end of 2014.

 

The Director General of the Insurance Authority estimated the total value of the premiums written in the Emirati insurance sector during 2014 to be 33 billion Dirhams, with a growth rate of 12% when compared to the year 2013. The investments of insurance companies increased to 40 billion Dirhams, while the number of insurance companies operating in the UAE amounted to 60 and the number of professional companies related to insurance amounted to nearly 313.

 

He pointed out that the IIC aims to achieve a pool of objectives that serve the Islamic insurance industry. Most importantly, growth opportunities will be provided for the Islamic insurance industry worldwide, by setting legislation and laws that promote development from the legal and Sharia perspectives. These changes will lead to an increase in the number of Islamic insurance premiums in the region and the world, which will increase the contribution of insurance to the gross domestic product of the host countries. Furthermore, the objectives include boosting the confidence of markets in Islamic insurance products and Takaful services, as well as introducing the significant role of the Takaful insurance sector in protecting the national economy and providing economic protection to members of the society.

 

The IIC further aims to capture the real challenges that the Takaful insurance industry faces, pinpointing the methods and tools one must use to face and overcome them, and stating ways to develop the security which Takaful insurance companies provide to their participants. The IIC also aims to expand the base of transparency in the activities undertaken by Takaful insurance companies, and create more bonds between the company and the participants. These efforts will consequently increase the overall insurance sector’s contribution to national gross domestic product.

 

Al Zaabi affirmed that the Insurance Authority spares no effort when establishing the legislative and regulatory rules needed to organize the insurance market and Takaful insurance in the UAE. After all, most of these rules represent an insurance system’s foundations at the regional level.

 

He noted the most important laws and instructions which have been issued by the Insurance Authority to regulate the UAE’s insurance market. These include the2009 regulation concerning insurance companies' minimum capital requirements, the rules concerning the professional practices of insurance companies which were introduced in 2010, the 2010 regulation concerning  Takaful insurance, the 2011 guidelines for insurance policy marketing through the banks, the 2011 regulation concerning insurance agents, the 2011 regulation concerning health insurance claims management, the 2013 regulation concerning Anti-Money Laundering and Combating Terrorism Financing, the 2013 regulation for insurance brokerage, the financial regulations for insurance companies which were introduced in 2014, and the financial regulations for Takaful insurance companies which were introduced in 2014.

 

Al-Zaabi also pointed out the importance of the Takaful insurance regulation of 2010 and the 2014 financial regulations for Takaful insurance companies. Their significance is manifested in the fact that the Takaful insurance regulations establish the Sharia and legal rules and principles required to regulate the Takaful insurance companies’ practices so that they comply with the rules of Islamic Law. Furthermore, the Takaful insurance regulations have defined the general framework of the Wakala & Mudarabah model, Sharia supervisory commissions, and the relationship between the participants and shareholders of the Takaful insurance company. On the other hand, the financial regulations that govern Takaful insurance companies complement the structure established by Takaful insurance regulation, through its ability to set the financial and technical principles that govern the activities of Takaful insurance companies.

 

The IIC agenda includes a paper on the new vision of Takaful insurance activities in the UAE, the region, and the world. The paper will be presented by H. E. Ebrahim Obaid Al Zaabi, Director General of the Insurance Authority. The first session focuses on the Sharia principles and rules governing Islamic (Takaful) insurance. The second session focuses on examining how groups can develop the Sharia principles and rules to govern the relationship between participants and the Takaful insurance company in terms of the security provided by the company to the participants.

 

The third session focuses on the importance of codifying the Takaful sector, while the fourth session focuses on governance in Islamic insurance companies. The fifth session focuses on informing participants of the work progress made in Takaful insurance companies and involving them in the technical and financial control of the company’s business.

 

The sixth session focuses on the technical calculations of the participants’ accounts (inputs outputs, outcomes, and how to determine the costs that the participants’ account will be charged with). The seventh session focuses on the rules that govern the distribution of surplus on the participants’ account.

 

The Insurance Authority has launched a website (iicevent.ia.gov.ae) to register the specialists, experts, and other parties interested in attending the IIC.

 

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