Omar Gouda, the man­ag­ing di­rec­tor of Africa Re­taka­ful

RISKAFRICA Magazine - - • REINSURANCE CONFERENCE -

Ses­sion two: Global in­sur­ance in­dus­try and key im­pli­ca­tions for the African in­sur­ance in­dus­try. This ses­sion will look at the global best prac­tices, both from emerg­ing and ma­ture mar­kets as well as de­vel­op­ments in the Taka­ful in­dus­try and the op­por­tu­ni­ties in Africa.

Gouda says Taka­ful prospects for the African mar­ket have huge po­ten­tial but there are also chal­lenges which must be faced and met by the Taka­ful in­dus­try if it is to gain a foothold on the con­ti­nent.

Some of the chal­lenges in­clude a lack of pub­lic aware­ness about the Taka­ful in­dus­try, as well as a lack of the re­quired fi­nan­cial in­fra­struc­ture. The in­dus­try needs to pro­vide so­lu­tions through a va­ri­ety of means that peo­ple trust and un­der­stand. “The prod­ucts that we are sup­ply­ing, the dis­tri­bu­tion chan­nels we are em­ploy­ing, and the rules and reg­u­la­tions we ad­here to, must be un­der­stood clearly by ev­ery­one,” Gouda says.

Un­like con­ven­tional in­sur­ance com­pa­nies, Taka­ful op­er­a­tors have to start from scratch in train­ing staff, es­tab­lish­ing branches and of­fices, ed­u­cat­ing reg­u­la­tors on Shari’ah law, and ap­ply­ing the lat­est tech­no­log­i­cal meth­ods to what is ul­ti­mately still a fledg­ling in­dus­try. Gouda points out that the Taka­ful in­sur­ance in­dus­try is grow­ing glob­ally at 12 to 20 per cent and Taka­ful con­tri­bu­tions were ex­pected to reach US$12 bil­lion by 2012. The gen­eral in­sur­ance cat­e­gory of the Taka­ful prod­ucts is fore­cast to grow by 24 per cent.

“The African con­ti­nent has played and is ex­pected to play a ma­jor role in the Taka­ful de­vel­op­ment, for many rea­sons, among which are the sub­stan­tial op­por­tu­ni­ties and the vast need for the Taka­ful in ad­di­tion to the lower pen­e­tra­tion rates. The above in­di­ca­tors sug­gest an in­creas­ing need for a reg­u­lar fo­rum for Taka­ful and Re­taka­ful for en­hance­ment of ex­per­tise and ex­change of knowl­edge, ideas and ex­pe­ri­ence to match the in­creas­ing need of the Taka­ful in­dus­try and over­com­ing chal­lenges,” he says.

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