MANAMA: The takaful industry in Bahrain is booming as people are favouring Sharia-compliant insurance.
Takaful total contributions grew by 16.5 per cent to reach BD13.4 million ($35.6m) in the first quarter of the year compared with BD11.5m for the same period last year, according to the Central Bank of Bahrain (CBB).
But traditional insurance still took the largest share of the market, down slightly at BD43.3m in the first quarter compared to BD44.1m last time.
The insurance market in Bahrain consists of 27 domestic insurance companies and 11 branches of foreign insurance companies covering both direct insurance and reinsurance.
The recorded data for the insurance market during the first quarter of the year shows a slight increase of 1.8pc in gross written premiums in the quarter up from BD55.7m last time to BD56.7m.
This growth was mainly due to the surge in the premiums of life insurance and the remarkable growth of the takaful. The combined capital of both conventional and takaful insurance companies grew by 4pc to reach BD163.6m in the first quarter compared to BD157.2m in the first quarter of 2010.
The total assets of insurance companies increased by 6pc to BD1.29 billion compared to BD1.22bn last time.
Conventional insurance reported the highest contribution in total assets at the rate of 79pc.
Reinsurance companies that operate from Bahrain showed a rise in both reinsurance premiums and net profit during the first quarter, increasing reinsurance premiums by 5.6pc to BD151m compared with BD143m.
The net profit of reinsurance companies increased by 3.8pc to reach BD8.1m against BD7m last time.
"The key indicators above show that there has been minimal negative effect on the growth of insurance companies due to recent events in Bahrain, where indicators clearly show a rise in total insurance premiums, capital and assets of the insurance market in Bahrain, in addition to the remarkable growth of the takaful insurance industry keeping up with the growth of both the direct insurance market or the reinsurance market in previous years," the CBB said.