Islamic financial activity in London is developing a growing maturity, the chief executive of the International Underwriting Association (IUA), stated.
Dave Matcham pointed to the growth of commercial sharia compliant products as an important example of the innovation required by the London Market to maintain its position as a global insurance hub.
His message was delivered on Nov.8 in a speech at the inaugural conference of the Islamic Insurance Association of London (IIAL)* in Dubai. Delegates heard how the IUA and IIAL are cooperating to support the trade in Islamic insurance, promoting standards and transparency.
“Until recently the supply of sharia compliant commercial insurance products was a missing piece of the financial jigsaw,” said Matcham. “The puzzle is now complete, these types of risks are now being written and we are looking to build on this in yet another example of how the London market evolves and innovates its product offering.”
Another speaker at the IIAL meeting was the CEO of the Dubai Islamic Economy Development Centre, Abdulla Mohammed Al Anwar, who said moves by the London market to embrace the provision of Islamic insurance products can only benefit the broader market.
He said the IIAL’s inaugural event was a further strengthening of the existing partnership between the U.K. and the UAE and he believed that the involvement of London in the Islamic insurance sector could only benefit local markets and customers alike.
The provision of sharia or takaful products was a vital part of Dubai’s plan to become the global center for the Islamic economy, he said, adding that the growth in takaful products was evident, but there was still more to do.
“I hope that we will see takaful companies encouraged to go beyond the comfort zone in terms of the products they offer,” he told 160 delegates from across the Islamic markets and the U.K.
He said there was a need for a growth in the provision of retakaful and other products such as microtakaful which provide access to insurance to those on low earnings.
Delegates also heard from a range of senior market figures including Lloyd’s Director of Global Markets Vincent Vandendael who said he hoped that the market will play a role in the growth of the number of London underwriters who will offer shariah compliant products in future.
He said the future may well see Lloyd’s work with coverholders who can market the products, while the syndicates provide the capital in a way that meets the needs of the Islamic community.
Jihad Faitrouni, CEO of Aman Insurance, said the market needed to address the challenges of distribution, technology and the cost of cover.
“There is a need to grow the market and we would welcome support from the London market in terms of a partnership that can deliver the expertise to the market,” he said.
*The Islamic Insurance Association of London was launched in April this year to represent insurers and reinsurers providing shariah compliant cover. It is chaired by former Lloyd’s Chairman Max Taylor.
Source: International Underwriting Association and Islamic Insurance Association of London
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