The takāful industry has been enjoying with remarkable growth and strong performance for more than 2 decades. From 2005 to 2010, the industry underwent a compound average growth rate of 27% in terms of net contributions, with family takāful driving at 28% growth for the same period, to dominate more than 80% of the total takāful market in 2010. It is expected that the industry will continue to growth strongly as the insurance and takāful are largely with only 54% of the population having a life insurance or family takāful coverage. With the new four licensees, the takāful market will further elevate the penetration rate which is currently at 10.9% as well as the market share for the insurance and takāfulindustry, which is currently at 13.3% in terms of net contribution and 8.9% in terms of takāful and insurance assets. Concurrently, the regulatory framework for the Islamic financial system was further strengthened with the development of a more robust solvency framework, enhanced regulatory framework for the management of takāful funds and Shariah governance standards for Islamic banks and takāfuloperators. The capital adequacy requirements for takāful operators were further defined, building on the parameters earlier established under the proposed Risk-Based Capital Framework for Takaful Operators (RBCT) and incorporating risk charges that are calibrated to reflect the underlying differences of business models in takāful operations…”
