World Takaful Conference begins tomorrow

More than 400 key players and thought leaders in the global Takaful industry will be gathering on the 15th and 16th of April 2013 in Dusit Thani, Dubai, for the 8th Annual World Takaful Conference (WTC 2013), according to a press release from its organisers. Held under the theme “New Strategic Imperatives for the Takaful Industry: Sustaining Growth and Boosting Profitability”, WTC 2013 aims to set the stage for discussions that will strive to improve the competitive performance of Takaful players and will also seek to identify and capitalise on the new growth drivers for the global Islamic insurance industry.

Speaking ahead of the event, David McLean, Chief Executive of the World Takaful Conference, noted that “the global Takaful market has shown strong growth in the last few years. Driven by increasing consumer awareness and improvements in the quality of products and services being offered, the global Takaful industry has seen a significant increase in its market share. With tremendous growth opportunities yet to be fully tapped, the international Takaful industry is poised to enter a new phase of major growth in the coming years and therefore it is essential to ensure that strong foundations are in place to fully support this growth. A critical challenge facing the industry is that a large number of Takaful operators are finding it difficult to sustain financial performance due to the increase in competition. Though the overall outlook for the global Takaful industry remains positive, it is essential that the mounting challenges posed by increasing competitive pressures and declining underwriting profits combined with the reduction in investment income need to be immediately tackled so that the industry can maintain its exciting growth trajectory.”

McLean also added that “the Takaful industry, like any other growing industry, is facing a number of challenges such as balancing a growth drive with sustainable profitability, the need for skilled professionals, an enhanced regulatory and prudential framework and a deeper pool of Shari’ah-compliant investment opportunities all of which need to be urgently addressed.”

The World Takaful Conference 2013 will be officially inaugurated with a special opening keynote address by Jeff Singer, Chief Executive Officer of the Dubai International Financial Center Authority (DIFCA). Confirming his participation at the event, Jeff Singer said that “the global Takaful market has shown strong growth over the last few years. The key factors underpinning this growth include the development of supporting regulatory frameworks, favourable demographics, growing affluence, the growth in organized savings and the overall development of the international Islamic finance industry resulting in greater availability of Takaful and Islamic finance products that meet the needs of end-users. However the key challenges for the global Takaful industry remain efficiency, profitability and scale. In order to ensure the long term stability of the global Takaful industry, it is essential to find innovative solutions to manage the challenges of an increasingly competitive Takaful market, drive operational efficiencies and improve the financial performance in the industry.”

He also said that “the theme for this year’s World Takaful Conference (WTC 2013) - “New Strategic Imperatives for the Takaful Industry: Sustaining Growth and Boosting Profitability” is important and timely as the Takaful industry globally is evolving rapidly and there is tremendous growth potential.”

“I am delighted to be a part of the debates and discussions at the 8th Annual World Takaful Conference (WTC 2013) in Dubai that will seek to achieve the full potential of the global Takaful industry”, he added.

The inaugural session will be immediately followed by a keynote plenary session featuring Zainudin Ishak, Executive Director & Chief Executive Officer of HSBC Amanah Takaful (Malaysia) and Chairman of the Malaysian Takaful Association; Chris Wei, Group Chief Executive Officer of Great Eastern Holdings Limited; Hussein Al Meeza, Managing Director and Chief Executive Officer of Dubai Islamic Insurance and Reinsurance Company (AMAN); and Parvaiz Siddiq, Chief Executive Officer of Noor Takaful. The session, which will analyse new strategies for sustaining growth in the global Takaful industry, will address the challenges of slowing growth rates and competitive pressures and will assess how Takaful operators can effectively manage the shift to profitability.

A key highlight of the 8th Annual World Takaful Conference (WTC 2013) will be the exclusive industry leaders’ power debate featuring an exceptional cross-section of international thought leaders in the global Shari’ah-compliant insurance industry. The session chaired by Irshied Tayeb, Regional Head of Insurance Services - Middle East & North Africa, Bin Shabib & Associates and featuring Dr. Bassel Hindawi, Immediate Past Insurance Commissioner of Jordan;  Shahril Azuar Jimin, Senior Executive Vice President / Chief Commercial Officer of Maybank Ageas Holdings Berhad; and Azim Mithani, Chief Executive Officer of Prudential BSN Takaful Berhad, will discuss practical solutions to overcoming the key obstacles to the further development of the global Takaful industry.

Featuring ground-breaking original research insights, WTC 2013 will also include the exclusive onsite launch of the Global Family Takaful Report 2013 and the World Islamic Insurance Directory 2013. The Global Family Takaful Report, developed by Milliman, will provide research insights into the performance of Family Takaful offerings, the future direction of the market and new opportunities for the growth of Family Takaful across key international markets, while the World Islamic Insurance Directory, jointly published by Takaful Re and the Middle East Insurance Review, will provide a snapshot of the global Takaful scene, with an insight into financial and management data of Takaful and Re-Takaful operators in key markets.

Speaking ahead of the launch of the Milliman Global Family Takaful Report 2013, Safder Jaffer, Managing Director & Consulting Actuary - Middle East & Africa, Milliman, noted that “with global family Takaful contributions currently estimated at US$2 billion, Milliman projects a 260 per cent increase within the next five years to US$5.2 billion. At a global level, the growth in Family Takaful continues to outweigh the growth observed in both general Takaful and conventional life insurance.”

“Following the successful launch of the first ever Milliman Global Family Takaful Report 2011, the feedback we got from practitioners was overwhelming and consistent –the industry needs to distinguish ‘Family Takaful’ from ‘General Takaful’. Whereas General Takaful is still exploring avenues to find its feet in the market, the success of Family Takaful has been solid particularly in South East Asia”, he said.

He also noted that “the 2nd Milliman Family Takaful report provides an update of  the overall market trends, a specially focused insight into the developing Indonesian market, which has witnessed significant growth in Family Takaful during recent years, and a focus on distribution in key Takaful markets in the Middle East and South East Asia. We are delighted to be launching this report at the 8th Annual World Takaful Conference (WTC 2013) and we look forward to discussing the findings of the report with the international industry leaders at WTC 2013.”

WTC 2013 will feature more than 35 leading industry partners and exhibitors showcasing their latest innovations at the World Takaful Exhibition organised along the sidelines of the conference. The exhibition will be officially inaugurated on the 15th of April.

Commenting on their participation at WTC 2013, Christian Gregorowicz, Chief Executive Officer of NEXtCARE said that “the global Takaful industry has shown strong growth in the last few years, with many new market entries, and has seen a significant increase in its market share in key countries, backed not only by increasing awareness and improvements in the quality of Shari’ah compliant products, but also with the a growing demand of Islamic financial solutions. To realize its full potential, it is essential for the Takaful industry to ensure long term operational and technical profitability. The way forward for leading operators is to focus on improving operational efficiency which will contribute towards enhanced financial performance.”

“We are delighted to be supporting the World Takaful Conference 2013 and we hope that the discussions at this key industry event results in identifying strategic initiatives that the industry must adopt to build on and sustain its long term growth", he added.

Ten Tips for Buying the Right Insurance in 2013

Most people buy insurance the wrong way. They buy it piecemeal. They buy a little bit of this here and a little bit of that there. They buy too much in some areas and not enough in others. Then, when there is a serious claim, their insurance coverage often fails them. If your New Year's resolution for 2013 is to fix that, we have some tips that can help you accomplish it.

Homeowners insurance

Tip 1: If Hurricane Katrina wasn't reminder enough, along came Superstorm Sandy in 2012 to remind everyone that homeowners policies do not cover flooding. The policies cover those homes destroyed by fire, and homes damaged or destroyed by a storm. But they do not cover flooding. If you are exposed to any chance of severe flooding, even if you don't live anywhere near a body of water, talk to your agent about flood insurance and check out the government flood insurance website at FloodSmart.gov.

Tip 2: If you work from home even part time, you need to add an endorsement to your homeowners insurance called "incidental occupancy endorsement." Homeowners policies, besides covering your building and contents, also cover personal liability, including liability for guests injured on your home premises. But they do not cover injuries to those who come onto your premises for business purposes. That includes not only businesses that have regular visitors to the home -- such as yoga instructors, piano teachers or day care providers -- it also includes injuries to the occasional visitor, such as a co-worker or delivery driver who's dropping off some work from the office and falls on your icy driveway in the winter and gets injured. No coverage. How much does it cost to add this nifty endorsement? Less than $30 a year. For that small price, it's silly not to have one.

Tip 3: Speaking of liability coverage, be sure to standardize your liability limits on all your policies -- auto, home, cabin, boats, etc. I recommend no less than $500,000. Remember, if you injure someone seriously, you will get sued for all the medical bills, for the lost wages they incur, and for pain and suffering.

Just the medical bills alone can easily reach $500,000 in a serious accident. If you have any income or assets that you are concerned about losing in a lawsuit, add an extra layer of protection on top of your basic policies in your insurance portfolio -- called an umbrella policy -- of at least $1 million or more. A $1 million policy costs about $200 a year. I consider it the best buy in the insurance business.

Car insurance

Tip 4: Most people are underinsured for lawsuits. The most common limit I see is $100,000 per person. That won't even cover the medical bills in a serious accident. The minimum liability coverage that anyone with any assets or income to protect should be carrying is $500,000 to $1 million or more. If your liability limits are low, contact your insurance agent right away and get those limits raised to more realistic figures. Raising liability coverage is surprisingly minimal in cost.

Tip 5: When you raise your liability limits on your car insurance, don't stop. Raise your limits on your home, cabin, boats, snowmobiles, etc., to the same amount. You don't know where the lawsuit may come from. You want the same amount of money protecting you, so it won't matter where it comes from.

Tip 6: Raise your uninsured and underinsured motorist coverage on your car insurance to the same levels as your liability coverage for people you hurt. It's estimated that 10% to 20% of all drivers have no insurance. I guarantee you that these are not the drivers with perfect driving records. Since we can't control who hits us or how much insurance they have or don't have, buying high limits of this coverage is the only way we can ensure that we and the loved ones riding with us get fairly compensated.

Tip 7: Save money by dropping collision and comprehensive coverage of older vehicles you can comfortably afford to replace without car insurance. Make sure you save enough money to make it worth the risk.

Save money on insurance by self-insuring more of the small losses on your vehicles with bigger deductibles. Not only does it save money, but it also reduces the number of small claims you file, thus keeping rates as low as possible now and in the future.

Life insurance

Tip 8: Remember that buying life insurance is an act of love. It's the only insurance policy that you can buy where you are not collecting on it. For a family of four, financial experts recommend that survivors of one parent's death make do with 7.5 times income. I recommend 10 times income. The extra cushion will allow the surviving parent to work fewer hours and spend more time with his or her children. Nothing can replace the emotional loss to the family. Don't compound the pain by adding financial stress to the picture.

Tip 9: For a young family getting started financially, I recommend term life insurance as the most cost-effective way to provide the most money for the lowest premium. Lock in the price for at least 20 to 30 years. And make sure the policy is convertible to a permanent policy, so if at the end of the term you find that you still need life insurance and can't qualify for it medically, you are assured you can convert.

If one spouse is a homemaker, carry at least $250,000 to $500,000 in life insurance on that person. Buy an amount high enough so the surviving working spouse can be more available to the children and still hire replacement services such as a nanny.

Tip 10: It's quite common for employers to provide some life insurance for their employees as a company benefit and at the same time offer them supplemental group life insurance on a payroll deduction basis. What most people don't realize is that the costs for the supplemental life insurance are quite a bit more than a healthy nonsmoker will pay on the open market for the same amount of coverage. The tip here is to not just buy group life insurance because you assume it's cheaper. It probably isn't. In addition, when you leave the company or the company closes down, so does your life insurance.