June 11 (Reuters) - One of the world’s oldest insurance brokers, Willis Group Holdings, will offer sharia-compliant commercial real estate coverage in Britain for the first time, helping address capacity constraints in the Islamic insurance (takaful) sector.
Set up in 1828, New York-listed Willis will offer the coverage through the Islamic insurance platform developed by London-based Cobalt Underwriting, one of several initiatives aimed at boosting London’s credentials in the Islamic finance industry.
“Hand in hand with the growth in Islamic finance is the demand for sharia-compliant insurance cover, in particular for real estate investors,” said John Dilley, managing director of the Willis real estate practice.
The policy retains price neutrality, meaning premiums are equivalent to those in a conventional insurance policy, Willis said in a statement.
In March, Cobalt signed up the European unit of QBE to its platform, which follows religious guidelines such as bans on interest and pure monetary speculation.
Cobalt’s platform uses a syndication model to help spread risk across a panel of underwriters, allowing multiple insurers to pool their capacity while each can subscribe to their desired level of risk though individual Islamic windows.
The risk is priced by a lead insurer and other firms must then subscribe under similar terms, a similar approach to the subscription model used in London’s Lloyds insurance market. (Editing by Andrew Torchia)