Report by Malaysia International Financial Centre Report
Takaful is an important growing sector in the Islamic finance industry, with continuous positive growth momentum in key markets and estimations of continued double-digit growth globally. While the GCC and ASEAN are expected to continue to lead the global takaful markets with their substantial growth, emerging markets within Europe and Africa are also showing significant growth potential.
Takaful: Where Are We Now?
Article Overview
Islamic finance has witnessed a tremendous growth across the globe over the last decade, representing one of the fastest growing sectors in the global financial system since its inception in the late 1960s. As a case in point, Islamic financial industry has registered 17.3 per cent Compounded Annual Growth Rate (CAGR) in the past five years (between 2009 and 2014).To date, total global financial assets of the Islamic financial industry are estimated to be around USD2tln and expected to surpass USD3tln by 2018. In addition, there are over 600 Islamic financial institutions
(IFIs) operating in about 75 countries around the world: ranging from banking, capital market to Takaful sectors. Takaful is an important growing sector in the Islamic finance industry with
continuous positive growth momentum in key markets such as the GCC and ASEAN.
Globally, the takaful market was estimated to continue its double digit growth momentum of about 14 per cent in 2014, reaching around USD26bln by end of 2015 and projected to surpass USD42bln by 2020 (2014E: USD23bln). Nevertheless, the size of the takaful industry is still small in comparison to other Islamic finance sectors, comprising a market share of 1.1 per cent only.
Share of Gross Takaful Contribution in GCC, 2014
