| 14 Jul 2010 |
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Takaful Insurance Markets Maintain Positive Momentum In 2010, Report Says
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DUBAI, July 14, 2010--After another positive year in 2009, Standard & Poor's believes the takaful and retakaful (Islamic insurance and reinsurance) sector is likely to continue to grow in 2010. In a new report titled "Takaful Insurance Has Long-Term Viability And Benefits From Expected Growth, But Stiff Competition Persists," we note that the long-term viability of these sectors remains supported by high expected levels of growth, broadly positive technical results, and an increase in profitability, particularly in the GCC region and Malaysia.
"Nevertheless, while these positive factors should support the growth of the sector, we believe that the highly competitive and, in some cases, developing, nature of the local marketplace, as well as the impact of global investment markets on returns, continue to place an ongoing strain on sustainable development," said Standard & Poor's credit analyst Neil Gosrani.
At the same time, we believe competitive pressures from within the sector, and from conventional insurers, means that success in this market requires careful navigation.
Since our first takaful rating in 1997, we have monitored the rapid development of an industry that we believe has benefited from the ongoing economic development in its core regions. Having grown from a niche product servicing limited demand, we believe that takaful has reached a critical mass in the past five years and is now firmly established within the global risk management markets. "We consider the potential for sustained growth in this market is significant, buoyed by the still-low insurance penetration and the growing recognition and acceptance of the concept of insurance and its benefits," added Mr. Gosrani.
The report is available to RatingsDirect on the Global Credit Portal subscribers at www.globalcreditportal.com and RatingsDirect subscribers at www.ratingsdirect.com. If you are not a RatingsDirect subscriber, you may purchase a copy of the report by calling (1) 212-438-7280 or sending an e-mail to research_request@standardandpoors.com. Ratings information can also be found on Standard & Poor's public Web site by using the Ratings search box located in the left column at www.standardandpoors.com. Alternatively, call one of the following Standard & Poor's numbers: Client Support Europe (44) 20-7176-7176; London Press Office (44) 20-7176-3605; Paris (33) 1-4420-6708; Frankfurt (49) 69-33-999-225; Stockholm (46) 8-440-5914; or Moscow (7)
495-783-4011.
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About Standard & Poor's in the GCC
Standard & Poor's is the leading provider of financial market intelligence to customers in the Gulf's credit risk management, wealth management, and data and information markets. Since entering the region in the late 1980's, Standard & Poor's currently has public ratings on more than 100 issuers. In equity markets, Shariah-compliant versions of Standard & Poor's global and regional equity market indices - S&P 500, S&P Europe 350, S&P Japan 500 and S&P/IFCI GCC - have created new opportunities for Islamic investors to benchmark their international investments and for asset managers to create new investment products serving the Islamic community. Standard & Poor's Fund Services launched a qualitative fund management rating service for regional asset managers in 2007 assigning 17 Fund Management Ratings. For further details on Standard & Poor's regional capabilities please visit www.gcc.standardandpoors.com
Analyst contacts:
Neil Gosrani, London
Kevin Willis, Dubai
Ritesh Maheshwari, Singapore
Press Office Contacts:
London: +44 20 7176 3605
Dubai: +971 4 372 7171
Paris: +33 1 44 20 6740
Frankfurt: +49 69 33999 225
Milan: +39 02 72 111 245
Madrid: +34 91 389 6944
Moscow: +7 495 783 4011
Stockholm: +46 8 440 5914
© Press Release 2010
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