Salaam Halal, the UK's only standalone Islamic insurer, will expand next year to offer takaful insurance to companies run by Muslim business owners. The insurer, which launched in 2008 providing car insurance and more recently home insurance, is targeting the two million Muslims living in the UK.
Chief executive Bradley Brandon-Cross says: "As the first independent Islamic insurance provider in the UK, understanding the needs of the Muslim community is key to our success. It was always our intention to look at the business market. We will be very much focusing on this project in 2010."
The plan is to offer the UK's first takaful product range for Muslim-owned small and medium-sized business. In Britain, there are some 140,000 of these, with concentrations in London, Leicester and Birmingham. Salaam Halal will particularly target businessmen with less than ï¿½1m annual turnover, typically lawyers, accountants, doctors and retailers.
Salaam Halal is considering offering life savings products in partnership with other insurers in the UK. The company also plans to move into European countries with large Muslim populations, such as France, Germany and the Netherlands.
Despite the UK insurance market being flooded with more than a hundred insurance companies actively writing motor, home and business insurance, there has never been a real choice for Muslims who want the option of buying a product that is aligned with their faith. Historically, many Muslim businesses began in city centres, in older properties, and often open long hours. The locations and trades they operated in have been markets that most insurers have avoided.
Although Muslim business in general has moved on, insurers are still using historic data rather than predictive information, meaning there is little change to the way most insurers view the sector. However, it has to be stressed that this is in no way race-related.
On grounds of practicality and faith, offering takaful insurance that includes general liability, commercial motor, commercial property and pecuniary loss, has good potential. The packages on offer to this sector are looking tired as they are based on products developed 40 years ago, so a new approach could appeal to more than the Muslim sector.
This article first appeared on Moneymarket.com on 2nd October 2009.