Global Takaful Market Overview 2018, Demand by Regions, Share and Forecast to 2023

According to the latest report by IMARC Group, titled “Takaful Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2018-2023”, the global takaful market reached a value of around US$ 19 Billion in 2017. Takaful is an Islamic insurance concept based on the principle of mutual sharing of risks. In this type of insurance, the participants pool in a specific sum so as to provide aid at the time of need and guarantee that the losses will be distributed equally across each member. In takaful, the amount of contribution is decided according to the personal circumstances of members and the type of coverage they require. Takaful insurance companies serve as an alternative to commercial insurance companies as the latter violate the restrictions on interest, uncertainty and gambling principles which are outlawed in sharia. Recently, there has been a rise in the number of institutions that offer Islamic financial services which have aided in the expansion of takaful across the globe.

Countries in South East Asia have implemented the Life Insurance and Family Takaful (LIFE) Framework which is expected to spur various market activities and enhance the sustainability of the takaful industry in the longer run. Apart from this, there has been a rise in the awareness among Muslims regarding the monetary benefits offered by takaful insurance. This has encouraged foreign insurance companies to collaborate with takaful insurance companies, in turn, expanding their worldwide market reach. Moreover, the demand for takaful insurance products is also rising amongst the non-Muslim consumers as it is an ethical investment policy, with strong growth prospects and price competitiveness. Despite these growth-inducing factors, the global takaful market is being impeded by the current inability of insurers to retain consumers. As a result, the market value is projected to exceed US$ 40 Billion by 2023, expanding at a CAGR of 13% during 2018-2023.