Read Full Magazine Here. Takaful came into existence in the backdrop of an increased demand for a financial system that brings the concept of insurance in line with Islamic values and the fundamental principles of Islamic finance.
Many individuals, particularly in Muslim majority countries like Pakistan, Malaysia, Bahrain, the Kingdom of Saudi Arabia, and the United Arab Emirates, face limited acceptability to formal insurance due to concerns around Riba (interest), Gharar (uncertainty and ambiguity in contracts), Maysir (speculative risk), and other factors. Takaful insurance emerged as a key component of Shari’ah-compliant financial services that aims to cater to individual’s insurance needs, while also conforming to Islamic beliefs and norms. Since the establishment of the first Shari’ah-compliant insurer in Sudan in 1979, Takaful has been operating on a cooperative model much like mutual insurance, but the similarities between the two financial systems are only on the sur- face. A deeper analysis reveals differences in the two models that set Takaful apart from other conventional forms of insurance in terms of risk sharing and fairness. The very essence of the Islamic form of insurance is the participation of members in the contribution of funds into a common pool, where resources are collectively available to support members facing specified adverse events or losses.
It is important to note that the Takaful business is set for significant development and growth between 2023 and 2028. It brings a significant and ethical shift in insurance, aligning with Shari’ah principles and emphasizing community welfare. Takaful’s focus on ethical practices ensures fair insurance choices. This innovative approach promises a financially secure and com- passionate future for everyone involved.
t’azur Takaful Insurance Company is a great name in Takaful. t’azur Takaful was established in the year 2007 by a group of prominent business houses with authorized capital of K.D 5,000,000 and paid-up capital of KD 5,000,000 as the first Takaful insurance operator with regional perspectives.
t’azur Takaful is committed to developing sharia-compliant products and services that offer policyholders exceptional value and that are custom-made to suit their wants and needs. These products and services must stand the test of strong corporate governance to build trust in the regional marketplace.
t’azur Takaful Insurance Company was incorporated in accordance with Kuwaiti Commercial Companies Law and carries out its operations in compliance with rules and regulations issued by the Ministry of Commerce & Industry.
Through organic growth, strategic acquisitions, and partnerships, t’azur Takaful will create a unique market reach, the t’azur Takaful name becoming synonymous with takaful leadership, innovation and customer service of the highest standard.
The company continues to adapt to the current economic environment by innovating its internal processes resulting in better decision-making.
As such, it is important to shed light on the rich career of Samer Al Hamra who is leading t’azur Takaful Insurance Company to new heights.
Samer Al Hamra, based in Kuwait, is currently the CEO at t’azur Takaful Insurance Company, bringing experience from previous roles at National Takaful Insurance Company and Takaful International Insurance. With a robust skill set that includes Risk Management, Insurance, Reinsurance, Claims Management, Analysis, and more, Samer Al Hamra contributes valuable in- sights to the industry.
Work Experience
Total years of experience :25 years, 6 Months
Samer Al Hamra is currently a recognized CEO at t’azur Takaful Insurance Company. Samer Al Hamra is famed for his outstanding success amidst the current economic crisis and wars in the Middle East.
Senior Manager – Fire and General Accident Department at National Takaful Insurance Company- November 2017
February 2014: Since national Takaful established in 2003 with big portfolio the top management decided to segregate the departments and each department managed by Separate Manager who have the experience to control, follow up and improve its performance and efficiency.
Manager - Technical Department at Takaful International Company for Takaful Insurance – Kuwait-July 2009 to January 2014
Assistant Manager at Gulf Takaful Insurance Company-Kuwait - Al Kuwait- September 2005 to June 2009
Senior Supervisor at Wethaq Takaful Insurance Company Kuwait – Kuwait-June 2001 to September 2005
Branch Supervisor and Underwriter at Gulf Insurance Company
Kuwait - Al Kuwait-January 1999 to May 2001
BL: What are your views on the current takaful industry in the Arab countries?
Samer Al Hamra: The Takaful industry in Arab countries is experiencing substantial growth and development due to increasing demand for Sharia- compliant financial products, supportive regulatory frameworks, and technological advancements. Countries like Saudi Arabia, the UAE, and Malaysia are leading the way, benefiting from a predominantly Muslim population that values Sharia- compliant services. Regulatory bodies in these countries have implemented clear guidelines to ensure transparency and compliance, which has been crucial for building consumer trust and attracting investments. Additionally, the Insurance Regulatory of Kuwait (IRU) ensures that these companies adhere to Shariah principles. This involves verifying that products, services, and investment activities comply with Islamic law. Further to that The IRU mandates that Takaful companies establish Shariah Boards composed of qualified Islamic scholars who provide guidance and ensure that the Company’s operations are Shariah-compliant. The adoption of digital technologies is transforming the industry, with companies leveraging digital platforms and mobile apps to enhance their offerings and improve customer experience. This technological integration is making Takaful products more accessible, particularly to the younger, tech-savvy generation.
The industry is also witnessing a trend towards product diversification, expanding beyond family and health Takaful into areas such as property, motor, and micro-Takaful. This diversification is attracting a broader customer base and addressing various insurance needs within the population. However, the industry faces challenges, including limited awareness and understanding of Takaful among potential customers and the need for skilled professionals who understand both insurance and Sharia principles. Despite these challenges, the Takaful industry in Arab countries holds significant potential for continued growth. By addressing issues related to awareness, education, and talent development, the industry can expand its reach and play a vital role in providing ethical and inclusive financial services in the Arab world.
BL: What are your plans for the rest of 2024?
Samer Al Hamra: As we navigate the fourth quarter of 2024, the insurance market in Kuwait presents numerous opportunities for growth and innovation, we t’azur takaful insurance company have some strategic plans that can help an insurance company thrive in this dynamic environment:
1. Embracing Digital Transformation
In today’s digital age, enhancing customer experience through technology is paramount. Investing in digital platforms such as mobile apps and online claim processing can streamline operations and provide customers with convenient and efficient service. Additionally, incorporating AI-driven customer service can offer personalized support and quicker resolutions to customer inquiries.
2. Diversifying Product Offerings
To meet the evolving needs of the Kuwaiti market, introducing new insurance products is essential. Health insurance plans that cover telemedicine services can cater to the growing demand for remote healthcare. Additionally, specialized coverage for small and medium-sized enterprises (SMEs) can support local businesses and drive economic growth.
3. Educating Customers
Customer education is a crucial aspect of building trust and awareness. Launching educational campaigns can inform customers about the benefits of various insurance products and how they can protect their assets and health. This can lead to more informed decision-making and increased adoption of insurance services.
4. Promoting Sustainability. Sustainability is becoming increasingly important in the insurance industry. Developing insurance products that support environmental sustainability, such as coverage for green buildings or renewable energy projects, can attract environmentally conscious customers and contribute to a greener future.
5. Forming Strategic Partnerships Collaborating with local businesses and international insurers can enhance product offerings and competitiveness. Partnerships can provide access to new markets, share expertise, and create innovative solutions that benefit both the company and its customers.
6. Ensuring Regulatory Compliance Staying compliant with local regulations is vital for maintaining trust and credibility. Regularly reviewing and updating products and services to align with new laws or guidelines ensures that the company operates within legal frameworks and avoids potential penalties.
By focusing on these strategic areas, an insurance company in Kuwait can position itself for success in the remainder of 2024. Embracing digital transformation, diversifying products, educating customers, promoting sustainability, forming partnerships, and ensuring regulatory compliance are key steps to achieving growth and customer satisfaction in this competitive market.
BL: How has AI impacted your operations?
Samer Al Hamra: AI has significantly transformed operations in the insurance industry. One of the most notable impacts is on customer service. AI-powered chatbots and virtual assistants are now providing round-the-clock support, answering queries, processing claims, and offering personalized recommendations. This has greatly improved customer satisfaction and reduced response times.
In terms of risk assessment, AI algorithms analyze vast amounts of data to assess risks more accurately. This helps in pricing policies more precisely and identifying potential fraud, leading to better decision-making and reduced losses. Claims processing has also been streamlined with AI automating the workflow from initial claim submission to final settlement, making the process faster and more efficient for both the company and the customers.
Predictive analytics is another area where AI has made a significant impact. By forecasting trends and customer behavior, insurance companies can develop targeted marketing strategies, anticipate customer needs, and create customized insurance products. AI systems are also adept at detecting unusual patterns and anomalies in data, which helps in identifying fraudulent claims and preventing significant costs.
Personalized marketing has become more effective with AI analyzing customer data to create tailored campaigns. This understanding of customer preferences and behaviors allows insurance companies to offer products and services that are more relevant to their customers, improving engagement and retention.
Operational efficiency has increased as AI automates routine tasks, freeing up employees to focus on more complex and value-added activities. This boost in productivity is complemented by enhanced underwriting processes, where AI-driven evaluations result in more accurate risk assessments and faster policy issuance.
Overall, AI has revolutionized the insurance industry, making operations more efficient, customer-centric, and data-driven.
BL: Is AI a threat to takaful operations?
Samer Al Hamra: AI presents both opportunities and challenges for takaful operations. On the positive side, AI can significantly improve operational efficiency by automating routine tasks like claims processing and customer inquiries, leading to faster service and reduced costs. AI- driven analytics can also provide deeper insights into customer behavior and risk assessment, enabling more accurate pricing and personalized product offerings.
However, there are potential risks. Ensuring that AI systems comply with Shariah principles is crucial, as any deviation could undermine the ethical foundation of takaful. AI systems can also inadvertently introduce biases, leading to unfair treatment of certain customer groups, which goes against the principles of fairness and equity in takaful. Additionally, the need for large amounts of data raises concerns about privacy and security, which are essential to maintain customer trust and comply with regulatory requirements. The “black box” nature of some AI systems can make it difficult to understand how decisions are made, posing challenges to transparency and accountability. Developing AI systems that are explainable and transparent will allow stakeholders to understand how decisions are made, ensuring alignment with ethical and legal standards.
BL: T’azur aims to become a region-wide market leader in both family and general takaful, could you elaborate?
Samer Al Hamra: t’azur, a Kuwaiti-based takaful provider, has set ambitious goals to become a market leader in both Group and General Takaful across the region. Established in 2007, T’azur offers a range of Shariah-compliant insurance products designed to meet the needs of individuals and businesses.
To achieve its goals, T’azur is focusing on several key strategies. First, it aims to develop a comprehensive portfolio of takaful products. For Group Takaful, this includes medical and Group Takaful Insurance which provide umbrella cover for the laborers and their rights as part of our social security responsibilities, while General Takaful covers areas such as motor, home, and corporate insurance. By diversifying its offerings, T’azur can cater to a broader customer base and address various insurance needs. To support its growth, T’azur plans to grow both organically and through strategic partnerships. Organic growth involves enhancing its existing operations and customer base, while the partnership with the local and regional reinsurer can provide immediate access to new markets and capabilities. Building strong local distribution partnerships is also crucial for T’azur’s strategy. Collaborating with local businesses and leveraging their market knowledge can help T’azur offer more competitive and tailored products.
Given the mandatory healthcare regulations being rolled out across the region, T’azur sees significant growth potential in medical insurance. By focusing on this sec- tor, the company aims to meet the increasing demand for health coverage.
T’azur’s operations are overseen by a Shariah Supervisory Board to ensure all products and services comply with Islamic law. This commitment to Shariah compliance is a cornerstone of T’azur’s business model and helps build trust with its customers. By focusing on these strategic areas, T’azur aims to solidify its position as a lead- ing provider of Group and General Takaful Insurance in the region. The company’s com- prehensive approach, combining product diversification, and strong partnerships, positions it well to achieve its ambitious goals.
BL: How do you evaluate the takaful business in Kuwait? What are your suggestions?
Samer Al Hamra: The takaful business in Kuwait is a growing sector with significant potential. Kuwait’s strong Islamic finance market, which includes a wide range of banking, sukuk (Islamic bonds), and takaful entities, provides a robust foundation for the growth of takaful services. The main business lines for takaful companies in Kuwait are non-life insurance, with medical and motor insurance being the leading products. Other prevalent lines include marine, travel, fire, and group policies.
There are several strengths in the takaful market in Kuwait. The demand for Shariah-compliant financial products is high, driven by the country’s predominantly Muslim population. The Kuwaiti government supports the growth of Islamic finance, including takaful, through favorable regulations and policies. Additionally, the sector has shown resilience and growth, even during challenging times such as the COVID-19 pandemic. However, there are also challenges. The market is competitive, with several established players offering similar products. There is still a need to increase awareness and understanding of takaful products among potential customers. Ensuring operational efficiency and cost-effective- ness while maintaining compliance with Shariah principles can also be challenging. To foster growth, investing in digital platforms can enhance customer experience and streamline operations. Mobile apps, online claim processing, and AI-driven customer service can make takaful services more accessible and efficient. Developing new and innovative takaful products that cater to the specific needs of the Kuwaiti market can help attract more customers. For example, offering specialized health insurance plans that cover telemedicine services or creating products tailored for SMEs.
Launching educational campaigns to raise awareness about the benefits of takaful can help increase adoption. Providing clear and concise information about how takaful works and its advantages over conventional insurance can build trust and interest. Forming strategic partnerships with local businesses and international insurers can enhance product offerings and competitiveness. Collaborations can provide access to new markets and share expertise. Focusing on sustainability by developing takaful products that support environmental sustainability can attract environ- mentally conscious customers. This could include coverage for green buildings or renewable energy projects. Staying updated with regulatory changes and ensuring all products and services comply with local and Shariah regulations is crucial. This helps maintain trust and credibility in the market. By focusing on these areas, takaful companies in Kuwait can strengthen their market position and achieve sustainable growth.
BL: Takaful: An Alternative Approach to Insurance, what is your opinion?
Samer Al Hamra: Takaful, an Islamic alternative to conventional insurance, presents a compelling approach that aligns with the principles of mutual cooperation and shared responsibility. It operates on the principles of mutual assistance, risk-sharing, and ethical investment, making it an attractive option for those seeking insurance that aligns with their religious beliefs and ethical values. Unlike conventional insurance, which often involves elements of uncertainty (gharar), gambling (maysir), and interest (riba), Takaful is structured to avoid these elements, providing a Sharia-compliant alternative. The model emphasizes participants pooling their resources to support each other in times of need, fostering a sense of community and mutual benefit, contrasting with the profit- driven motive of conventional insurance companies. The surplus in the Takaful fund, after claims and operational costs, is usually redistributed among participants or used for charitable purposes, reinforcing mutual support and solidarity.
Takaful also emphasizes transparency and fairness in its operations, with participants fully informed about how their contributions are used, building trust and confidence. With the global Muslim population growing and increasing awareness of Islamic finance, Takaful has significant market potential. It provides an inclusive option for those who might otherwise be excluded from the insurance market due to religious reasons. The principles of Takaful can appeal to a broader audience interested in ethical finance, regardless of their religious background. However, the industry faces challenges such as regulatory differences across countries, limited awareness, and the need for skilled professionals in Islamic finance. To fully realize its potential, the Takaful industry must address these challenges, innovate, and educate potential customers about its benefits. Overall, Takaful offers a viable and ethically sound alternative to conventional insurance, focusing on mutual assistance, transparency, and community welfare.
BL: The Takaful business is set for significant development and growth between 2023 and 2028, how and why?
Samer Al Hamra: The Takaful business is expected to experience significant growth between 2023 and 2028 due to several key factors. Increasing awareness of and demand for ethical insurance options that comply with Sharia law are driving more people to seek Takaful products. This trend is further supported by the expanding global Muslim population, particularly in regions such as Asia, Africa, and the Middle East, where many young Muslims are entering the workforce, creating a larger customer base for Takaful. Government support and regulatory developments are also playing a crucial role in this growth. Many governments are promoting Islamic finance through favorable policies and efforts to standardize Takaful regulations across different regions, facilitating expansion.
Technological advancements are an- other significant factor contributing to the growth of the Takaful industry. The adoption of digital platforms and fintech solutions is improving customer experience, reducing costs, and making Takaful products more accessible and innovative. Market expansion and product diversification are also key drivers. Takaful companies are exploring new markets, including non-Muslim majority countries, and offering a growing range of products to meet diverse customer needs, such as health, life, property, and micro-Takaful.
Strategic partnerships and collaborations are enhancing the capabilities and reach of Takaful providers. Alliances with conventional insurers provide access to additional expertise and resources, while cross-sector collaborations with banks, fintech companies, and other industries drive market reach and innovation. In- creased investment in the Takaful sector is providing the necessary capital for expansion and development, with a focus on infrastructure such as IT systems and skilled workforce to support operations. These combined factors create a favorable environment for the Takaful industry to grow and thrive between 2023 and 2028.
BL: How does takaful bring a significant and ethical shift in insurance, aligning with Shari’ah principles and emphasizing community welfare?
Samer Al Hamra: Takaful brings a significant and ethical shift in the insurance industry by aligning with Shari’ah principles and emphasizing community welfare. It operates on the principle of mutual assistance, where participants contribute to a common pool to support each other in times of need. This fosters a sense of community and shared responsibility.
Unlike conventional insurance, Takaful involves risk sharing among participants. Contributions are considered donations to help those in need, promoting solidarity and cooperation. It strictly adheres to Islamic principles, avoiding elements like interest, excessive uncertainty, and gambling, ensuring that operations are ethical and in line with religious beliefs.
Funds collected in Takaful are invested in Shari’ah-compliant ventures, excluding businesses involved in activities like alcohol, gambling, and interest-based lending. This promotes ethical and socially responsible investing. By focusing on mutual aid and ethical practices, Takaful contributes to the overall welfare of the community, encouraging financial inclusion and providing a safety net for those who might otherwise be excluded from conventional insurance. Takaful companies are governed by Shari’ah boards that ensure compliance with Islamic principles, adding a layer of transparency and trust, as participants know their contributions are managed ethically.
