Following 12 months of dedicated hard work, the Board of British Islamic Insurance Holdings (BIIH), reported that an important milestone has been achieved by the Company. The general insurance subsidiary of BIIH submitted its formal regulatory application, and business plan, to the UK Financial Services Authority (FSA) for authorisation to undertake general insurance business in the UK.
BIIH, in an innovative move, will be the first to offer Shari’a compliant insurance products to the British Muslim population from an FSA-authorised, stand alone Islamic insurance company, and is on target to commence writing business in the UK in the first quarter of 2008.
BIIH Board, chaired by Mr Abdulaziz Hamad Aljomaih, will meet on 14th of June 2007 in London and discuss the roll out of the launch plan following the FSA approval sometime during the second half of 2007.
In announcing this milestone Mr Abdulaziz Hamad Aljomaih, BIIH Chairman said, “I am delighted to say that BIIH is well on track to achieve its key business objectives in a timely manner. The Company has submitted a well researched business plan as part of a comprehensive regulatory application to the FSA for its approval and, in due course, hopes to be able to offer a compelling Takaful proposition to British Muslim consumers.”
Leading the creation of this innovative company is Gulf Ventures Corporation (GVC), Bahrain, which has worked with a number of leading international consulting firms and project managed the FSA application preparation process from conception to completion. GVC worked with Ernst & Young and KPMG in the UK and Mercer Management Consultants provided Takaful advisory services. Norton Rose provided legal advise and GVC worked with one of Europe’s premier actuarial consultants, EMB Consultancy. GfK NOP, a leading market research company, helped GVC in conducting primary research in the UK to assess the interest of British Muslim population in a Takaful proposition in the UK.
Following the formation of the company, £19 million (approximately $38 million) was raised from institutional and private investors in the Gulf Region who subscribed for shares in BIIH following a Private Placement which took place during the summer of 2006.
BIIH has a vision to become the Islamic insurance partner of choice for Muslims in the UK and Europe, following strong research which shows a huge market potential for a Shari’a compliant insurance cover from a focused and trusted Islamic Insurance provider. The business has also identified opportunities to use a Takaful based insurance solution for the fast growing ethical market.
The UK insurance industry is the largest in Europe and the third largest in the world after the USA and Japan. The UK’s annual per capita insurance spend is approximately £2,500 (US$4,600), which is the second highest in the world after Switzerland (as of 2005). Most people in the UK purchase some form of insurance and over 60% of households in the UK subscribe to home-related insurance, while more than 70% are covered for motor insurance. A comparison of the insurance penetration in the UK with that of the GCC region suggests that the UK’s per capita insurance premium in 2005 was 35 times more than that of the GCC region. In 2005, total general insurance premiums were £31billion (US$60 billion).
A UK survey conducted by BIIH indicated a strong preference for Shari’a compliant insurance solutions amongst UK Muslims with 50% responding that they are ‘extremely likely’ or ‘very likely’ to buy Motor Takaful as long as all aspects of the policy, including cost and level of cover, are comparable with their existing conventional insurance policy. A further 26% said that they would be ‘fairly likely’ to buy Motor Takaful. The corresponding figures for Household Takaful were 46% and 28% respectively.
This press release is directed solely at persons outside the United Kingdom and it must not be acted upon by persons in the United Kingdom.
