First Islamic insurance company set to write business in 2008
Biba is to form a committee to help brokers cash in on the growing market for insurance for the UK’s Islamic community.
This came as British Islamic Insurance Holdings (BIIH), the UK’s first insurance company specialising in Sharia-compliant, or Takaful, insurance said it was close to receiving authorisation by the FSA.
Peter Staddon, head of technical services at Biba, said he believed there were significant opportunities for brokers to offer Takaful insurance.
In line with Islamic views, Takaful – meaning collaboration or joint guarantee – insurance is free from uncertainty and gambling.
In Takaful insurance, each participant contributes to a fund used to support one another, with each participant contributing sufficient amounts to cover expected claims.
Staddon said because of a lack of Takaful options, some Muslims may be forced to purchase a product they were not comfortable with.
He said: “I would like to see brokers play an integral part – they can provide cred-ibility and explain the various options.”
Staddon said he planned to invite Lord Sheikh, chairman of the Conservative Muslim Forum, to chair the inaugural committee meeting.
Takaful insurance companies invest in only companies that conform to the principles of Islamic financing. For example, some Muslims may take issue with its insurance company investing in tobacco or alcohol companies.
Staddon said he expected there to be interest in Takaful insurance from outside of the Islamic communities.
Meanwhile, British Islamic Insurance Holdings said it was on target to begin writing business for the first quarter of 2008. The company’s chief executive is former Rubicon boss Bradley Brandon-Cross.
BIIH will be the first company offering Takaful-specific insurance in the UK.
Biba hopes to have its committee running by early next year.
There are close to two million Muslims estimated to be living in the UK.