American International starts Islamic insurance
World’s largest insurer to offer ‘takaful’ coverage complying with Islamic law in health, autos and property.
MANAMA - American International Group, the world’s largest insurer, said it will offer its first insurance coverage complying with Islamic law, tapping a market that could be worth $15 billion (8 billion pounds) by 2015.
AIG’s Enaya unit will offer Islamic insurance coverage, or takaful, for areas such as health, autos and property to Gulf Arab customers, Abdallah Kubursi, Enaya’s regional vice-president, said.
The market for takaful, which is based on a concept similar to mutual funds, is growing at about 20 percent a year and could expand six-fold from about $2 billion now, Kubursi said.
"With the boom of Islamic finance and insurance in the region, there is an inherent need for sharia-compliant products," Kubursi said.
Germany’s Hannover Re and Prudential are among European companies that have started tapping into the Islamic insurance industry as the market grows.
AIG could expand the offer to Muslims in Asia, followed by Europe and the United States, Charles Bouloux, AIG president for the Middle East, Mediterranean and South Asia said.
"We’re not limiting our resources to just this region," Bouloux said.
AIG, based in New York, plans to open offices in Morocco, Algeria and Tunisia by the end of next year, Bouloux said that AIG already operates in North Africa, South Asia and the eastern Mediterranean.