Major Islamic insurance group takes shape in Dubai through merger

DUBAI, Dec. 19 (Xinhua) -- A Dubai stock-listed provider of Islamic insurances has agreed to acquire Al Hilal Takaful from Al Hilal Bank, which will create the largest takaful group in the United Arab Emirates (UAE), the state news agency WAM reported.

Takaful Emarat, a Dubai stock-listed provider of Islamic insurances (known as takaful) has agreed to acquire Al Hilal Takaful from Al Hilal Bank, Abu Dhabi in an all cash transaction.

The transaction has received initial approval from the UAE's Insurance Authority and brings together two "complementary takaful businesses," the report said.

Takaful Emarat provides life and health takaful insurance for customers, mostly in Dubai and the northern sheikhdoms of the UAE.

Al Hilal (Arabic for half moon) operates with a general licence, offering a range of cover for individual and corporate customers, primarily in the UAE capital Abu Dhabi.

The two companies wrote over 900 million dirham (245.23 million U.S. dollars) in combined gross written contributions in 2016.

Mohammad Al-Hawari, Executive Board Member and Managing Director of Takaful Emarat, said "in parallel, we are making strong progress in developing our digital platform, which will mean a highly efficient and cost effective service for our customers."

Al Hilal Takaful, a well-established and complementary business, "is a very good fit for us," he noted.

Alex Coelho, Chief Executive Officer of Al Hilal Bank, said "We are working closely together to ensure a smooth transition for all our insurance customers."

Earlier in the year, Fareed Lutfi, the Secretary General of the Emirates Insurance Association told Xinhua that the Islamic insurance sector in the UAE was ripe for consolidation.

"Many firms failed to implement a digital strategy unlike their conventional counterparts, and the times of overnight profits is over, too, due to a sharp rise in competition," he said.

Takaful Emarat's planned acquisition of Al Hilal Takaful is subject to full regulatory approvals and is scheduled to be completed in the first quarter of 2018.

On the Dubai Financial Market, Takaful Emarat gained 0.5 percent on Tuesday. Enditem