Oct 19 London-based Cobalt Insurance and a unit
of British outsourcing group Capita said they have
received "in principle" approval from Lloyd's of London to
launch the specialist insurance market's first sharia-compliant
Cobalt, formed in 2012 with capital from Capita insurance
services and the Bank of London and the Middle East, said it
planned to begin underwriting in the first quarter of 2017.
The syndicate, which will be managed by Capita Managing
Agency, will focus initially on developing a property and
specialty-focused book of commercial business from emerging and
developing markets in the Middle East, North Africa and Asian
regions, Cobalt said in a statement.
Lloyd's of London has been working to boost its credentials
in the Islamic finance industry.
"The aim of the syndicate is to look to underwrite new
business from emerging markets and in doing so working with
others in Lloyd's to extend their participation in those
markets," Cobalt founder Richard Bishop said.
Under sharia law, firms or individuals are not allowed to
charge interest or fees for loans.
The Islamic insurance or takaful industry is based on the
concept of mutuality, where a company oversees a segregated pool
of funds contributed by all policy holders.
In their investments, takaful firms must follow religious
guidelines such as a ban on interest and pure speculation.
Global takaful contributions were expected to reach $25
billion at the end of 2015, according to a report by consultants
Ernst & Young last July. (bit.ly/2egwiGo)
Cobalt, hoping to address gaps in the takaful and re-takaful
sectors, developed a sharia-compliant insurance platform in 2013
that uses a syndication model to help spread risk across a panel
of underwriters. (reut.rs/2e78re5)
(Reporting by Noor Zainab Hussain in Bengaluru; editing by Mark