Takaful Insurance Market

Takaful Insurance Market Outlook - 2030

The global takaful insurance market was valued at $24.85 billion in 2020, and is projected to reach $97.17 billion by 2030, growing at a CAGR of 14.6% from 2021 to 2030. 

Takaful is a type of Islamic insurance wherein members contribute money into a pool system to guarantee each other against loss or damage. Takaful insurance is based on sharia or Islamic religious law, which explains responsibilities of individuals to cooperate with each other and protect one another. Generally, takaful policies cover health, life, and general insurance needs. With having risk-sharing model concept, takaful insurance remains largely confined to the Muslim countries.

Takaful insurance is considered as the main form of insurance in Muslim majority countries. Hence, it is considered an important factor in boosting the market growth. Moreover, in takaful insurance, the investment profits are distributed among the participants and furthermore, premium amount collected from the members is returned, in case there are no claims. Thus, these are some of the major factors that propel the takaful insurance market growth. However, lack of standardization in takaful insurance due to regional differences and lower consumer awareness toward takaful insurance are some of the factors that limit the market growth. Furthermore, since a large number of world’s population is Muslim, there is an untapped market potential for the takaful insurance market. This, as a result is expected to create huge opportunities in the in the upcoming years. 

By distribution channel, the takaful insurance market was led by the agents & broker segment in 2020, and is projected to maintain its dominance during the forecast period. With an increase in demand for customized and personalized takaful insurance coverage’s, independent brokers and agents are utilizing several websites and online selling platforms, which has become a major trend in the market. However, the direct response segment is also expected to grow significantly during the forecast period, owing to growing preferences of customers towards directly purchasing of takaful insurance and growing number of benefit of direct sales which include relatively low cost of the product and others.

Region-wise, the market was dominated by GCC in 2020, and is expected to retain its position during the forecast period. The growth is attributed to improvement in the awareness about the benefits of takaful insurance is driven by the latest political and catastrophic events. Moreover, demographics influences such as the increasing population base, large workforce of foreigners, and increasing life expectancy are likely to have an optimistic influence on the demand of takaful insurance products in GCC. However, Asia is expected to witness significant growth during the forecast period, owing to rising digitization in various Asian countries and adoption of advance technology by the takaful insurance service provider to increase their sales and upsurge their market value is propelling the growth of the market in this region.

The report focuses on growth prospects, restraints, and trends of the takaful insurance market analysis. The study provides Porter’s five forces analysis to understand the impact of various factors, such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers, on the takaful insurance industry.

Segment Overview

The takaful insurance market is segmented on the basis of distribution channel, type, application, and region. By distribution channel, it is segmented into agents & brokers, banks, direct response and others. By type, it is segregated into family takaful and general takaful. Based on application, the market is divided into personal and commercial. By region, it is analyzed across GCC, Asia, MEA and rest of the World. 

Competitive Analysis   

The report analyzes the profiles of key players operating in the takaful insurance market such as Abu Dhabi National Takaful Co., Allianz, AMAN Insurance, Islamic Insurance, Prudential BSN Takaful Berhad, Qatar Islamic Insurance, SALAMA Islamic Arab Insurance Company, Syarikat Takaful Brunei Darussalam, Takaful International, and Zurich Malaysia. These players have adopted various strategies to increase their market penetration and strengthen their position in the takaful insurance industry.   

COVID-19 Impact Analysis

The unprecedented COVID-19 outbreak has moderately affected the takaful insurance market. As the pandemic caused huge financial losses to individuals globally, it has severely affected the collections made by the takaful insurance participants. Moreover, due to limited funds availability during the pandemic, the members could not afford to donate large amounts for the takaful insurance. However, surge in awareness among consumers regarding the importance of takaful insurance has accelerated the demand for health takaful insurance, family takaful, business protection policies, and others. Therefore, the takaful insurance has been moderately affected by the COVID-19 pandemic situation.

Top Impacting Factors

Market Penetration Among Muslim Majority Countries

Muslim majority countries such as the UAE, Saudi Arabia, Oman, Malaysia, and others, consider takaful insurance to be an ethical way of insurance according to the Islamic law. These countries have a higher penetration of takaful insurance as compared to the conventional insurance, as conventional insurance is considered unethical according to the Islamic law. Therefore, it is easier for the market players to increase penetration among the Muslim majority market. Furthermore, government initiatives toward takaful insurance are helping the market to flourish in countries such as Saudi Arabia, Malaysia, and UAE. Thus, these factors are propelling the growth of the takaful insurance market.   

Lower Chances of Financial Loss in Takaful Insurance  

According to the Islamic law, the premium collected should be pooled and used at times when the members face any kind of emergency such as medical issues, business losses, and others. Therefore, in case any such claim arises, the insured gets the required amount to cover the risk. In addition, in case no such claim is made, then the surplus amount is distributed among the members, unlike conventional insurance. Therefore, chances of financial loss are reduced drastically. These factors attract many new members to make donations in the takaful insurance. As a result, this is a major factor boosting the growth of takaful insurance market.

Key Benefits for Stakeholders 

•  The study provides in-depth analysis of the takaful insurance market share along with current & future trends to illustrate the imminent investment pockets.
•  Information about key drivers, restrains, & opportunities and their impact analysis on the takaful insurance market size is provided in the report.
•  Porter’s five forces analysis illustrates the potency of buyers and suppliers operating in the takaful insurance market.
•  An extensive analysis of the key segments of the industry helps to understand the takaful insurance market trends.
•  The quantitative analysis of the global takaful insurance market forecast from 2021 to 2030 is provided to determine the market potential.  

Key Market Segments

By Distribution Channel

•  Agents & Brokers
•  Banks
•  Direct Response
•  Others

By Type

•  Family Takaful
•  General Takaful
  •  Motor Takaful
    •  Personal
      •  Third Party Liability Coverage
      •  Comprehensive & Optional Coverage
    •  Commercial
  •  Property & Fire
  •  Medical & Health Takaful
  •  Marine, Aviation & Transport
  •  Others

By Application

•  Personal 
•  Commercial  

By Region

•  GCC
  •  Saudi Arabia
  •  UAE
  •  Bahrain
  •  Kuwait
  •  Qatar
  •  Oman 
•  Asia
  •  Malaysia
  •  Pakistan
  •  Indonesia
  •  Brunei
  •  Rest of Asia
•  MEA
  •  Iran
  •  Jordan
  •  Sudan
  •  Egypt
  •  Nigeria
  •  Rest of MEA 
•  Rest of the World 

Key Market players

•  Abu Dhabi National Takaful Co.
•  Allianz
•  AMAN Insurance
•  Islamic Insurance
•  Prudential BSN Takaful Berhad
•  Qatar Islamic Insurance
• SALAMA Islamic Arab Insurance Company
• Syarikat Takaful Brunei Darussalam
• Takaful International
• Zurich Malaysia   

 Takaful Insurance Market Report Highlights