Takaful Has Huge Potential: LOFSA
By: Sohan Das

Labuan: Labuan Offshore Financial Services Authority (LOFSA) urged players in the Takaful (insurance based on Islamic jurisprudence) industry to take advantage of the infrastructure and legislation already in place to offer comprehensive Takaful services and products.

This is so that they can enjoy a bigger bite of the fast expanding Takaful business.

“The potential for Takaful is huge, the industry collected RM1.1 billion or 10.6pc in premiums last year compared to 5.1pc in 2000.

“In the global market, Malaysian Takaful business constitutes 34pc of the total of USD550 million in premiums. With the expected increase in the number of Takaful operators in the coming years the Takaful business is expected to be more competitive, and so it would pay for Labuan operators to acquire the expertise or draw support from the qualified workforce from the domestic market so that they would be well placed to meet the challenges ahead,” LOFSA’s Director Sabaruddin Ismail said here Wednesday in an opening address at a seminar ‘Introduction Course On Takaful Labuan IOFC’.

Giving statistics on the number of Takaful operators world-wide now, Sabaruddin said they were only 40 Takaful operators and 5 Retafakul operators in 19 countries, and it was estimated the sector would grow by 25 to 40pc annually.

Calling more companies here whose business is related to insurance to venture into Takaful business Sabaruddin added that it could be done with no additional costs as the existing licenses under the Offshore Insurance Act 1990 enabled them to do so, they don’t have to set up a new company or inject additional capital but merely acquire the know-how of the business and stay committed to it.

He also said that Malaysia is being member of the Asean Retafakul International Ltd (ARIL) secretariat was entrusted to develop Takaful businesses in Indonesia, Bangladesh, Pakistan, Iran, Egypt, Nigeria and Turkey.

He went on to say that to increase awareness among the public towards. Takaful products and Islamic banking, a promotion would be held throughout the country from October 26th to 2nd November by Bank Negara while LOFSA would organise and participate in events held here with support of Association of Offshore Banks (AOB), Labuan International Insurance Association (LIIA) and Association of Labuan Trust Companies (ALTC).

Among those at the function was DG of LOFSA Noorazman Abdul Aziz.