Bahrain has registered a 25 per cent growth in Islamic insurance (takaful) at the international level, generating $133.5 million by the end of 2012, according to recent statistics.

This means that the takaful market in Bahrain has grown 10-fold over the past 10 years, it stated.

The global takaful insurance volume is estimated at $13.7 billion, with $5.7 billion or 41 per cent for Gulf markets and only $1.9 billion for South East Asian countries.

This makes GCC countries major players in the global takaful insurance market, Central Bank of Bahrain (CBB) executive director of financial institutions Abdulrahman Al Baker told our sister paper Akhbar Al Khaleej yesterday.

According to him, the CBB is working on revising the existing takaful model which it hopes will reaffirm Bahrain as the jurisdiction of choice for all takaful and retakaful companies globally.

Talking to the Gulf Daily News, our sister publication, on the sidelines of the second annual Middle East Takaful Forum (METF 2013), Al Baker said the changes to the model will attract new entrants to the market and foster competition for the betterment of the consumers.

"The new model also aims at facilitating a faster growth of takaful business in Bahrain while protecting the interest of all stakeholders," he stated.

Earlier in his keynote address titled "Reforming the Regulatory Regime - Key Initiatives to Ensure the Long Term Profitability of Takaful Industry in the Middle East", the CBB official provided key insights into improving the soundness of the regulatory and supervisory framework for Takaful players in the region to create a platform for long-term growth.

"During the past eight years, the takaful industry has recorded growth rates of around 20 per cent, indicating high growth potential in years to come due partly to the present low rate of takaful market penetration globally," he said.

In Bahrain, the Takaful industry is one of the fastest growing segments of the overall insurance sector, he added.

Quoting official data, Al Baker said as of the end of last year, total takaful premiums in the country had reached BD49.8 million ($131.3 million) compared to BD40 million in 2011, a growth of 25 per cent.

"Overall, the takaful market has grown by almost 12 times in term of premiums compared to 2003.

"This growth is mainly due to the increasing demand for Sharia-compliant insurance, rising public awareness, entrance of international players and enabling legislation that promotes the development of takaful in Bahrain," said Al Baker.

"Takaful premiums contribute almost 22 per cent of the overall gross premiums of the insurance industry in Bahrain, and the outlook for growth of this segment of insurance is very promising.

"During the past three years, we have observed positive changes in the mix of takaful contributions, as the family takaful has gained ground from overall total takaful premium.

"The family takaful share increased to 20 per cent of the gross takaful contributions last year compared to 10 per cent in 2009," he said.-TradeArabia News Service