Research Analyst
22 - 28, 2010

Pak-Qatar Takaful Ltd., the pioneer of Takaful in Pakistan, is regarded as a technology-driven Shari'ah-compliant company providing need-based and cost-effective Takaful solutions in Pakistan.

The company's vision of providing financial protection through Takaful (Islamic insurance) to everyone is supported by some of the strongest financial institutions in the state of Qatar such as Qatar Islamic Insurance Company (QIIC), Qatar International Islamic Bank (QIIB), Qatar Islamic Bank (QIB), Qatar National Bank (QNB), the Amwal Group, Masraf Al-Rayan, and Munich-based FWU AG. Their total assets under management amounted US$26.12bn as at 31 December 2007.

Pak-Qatar is the first dedicated Takaful Group in Pakistan with both Family and General Takaful operations. The company is further strengthened by its Re-Takaful arrangements with Munich-Re, Hanover Re and Takaful-Re. Pak Qatar Takaful is well-positioned to ensure impeccable client service investing heavily in procurement of state-of-the art technology from Malaysia and in SAP ERP solutions. The company has strategic BancaTakaful alliance with FWU AG.


Despite tough political and economical conditions in the country, the year 2008 witnessed substantial growth in all areas of company's operations. The company developed offices in 10 major cities of the country and was able to achieve gross revenue of Rs170.178 million.


Fire 11,445,609
Marine 5,857,882
Motor 64,526,347
Miscellaneous 4,591,137
Total 86,420,975
Individual Family 95,626,167
Group Family 52,563,525
Group Health 21,988,886
Total 170,178,578

In Individual Family Takaful segment, the company has developed a strong agency structure with manpower of approximately 800 trained Takaful consultants. The company has launched various products designed to meet the needs of various segments of the market. Through implementation of state-of-the-art business system, the company is focusing on strengthening the individual family Takaful business, which is very important for the long-term survival and growth of the company. The significant progress was also made to acquire corporate business.

Pak Qatar Takaful Company ended the year with writing a gross contribution amount of Rs. 86.4 million as against a target of Rs. 100 million for the year. Major contributor continued to be Motor Takaful as automobile is the only industry after communication that was growing in Pakistan. The recession has affected growth of this industry in the same way as it has affected all other industries.

The loss ratio on earned contribution basis stands at 137%, which comes down to 31% if calculated on gross contribution basis. This is likely to improve with the passage of time. The paid-up capital of Pak-Qatar Family is Rs. 533 million. The combined paid-up capital of the group is Rs. 840 million. Pak-Qatar Takaful now has the capability to launch new products and services driven by the consumer needs with speed and quality.


Currently there are two family Takaful and five life insurance companies operating in the country. With a penetration of 3% of the Gross Domestic Product (GDP), Pakistani market is still largely untapped. There is a strong need for halal savings plus protection products in the country. However, being a novel sector, Takaful is experiencing fierce competition from conventional players as they are considering Takaful a threat to their long-term survival.


CLASSES 2007 2006
Fire 33.08 31.56
Marine 14.37 15.17
Motor 37.55 39.98
Misc. 15.00 13.29
Grand Total 100.00 100.00

Overall, the life insurance industry is growing rapidly in Pakistan. In last few years, the growth of the industry is more than 30%. This manifests in the level of trust and confidence Muslim investors have, especially from the GCC States where the growth of takaful has been phenomenal, in the local insurance industry despite its historically low penetration rates (0.8%) and poor insurance density levels (US$5.9).

Unless these investors believe that takaful is an outright replacement and not just an apt alternative of conventional insurance, investments at large scale would not be possible. Takaful also provides all the benefits which any conventional insurer does, but with a value added ethical dimension, Shari'ah compliance, and business transparency.

With unique features such as Surplus Sharing and Waqf (religious endowment), takaful is all set to take off in Pakistan.

Bancassurance is also playing a major role in the growth and increase in penetration of insurance in the market. Within its first year of operation, Pak-Qatar has emerged as one of the major players in the market and made its presence felt.


Despite highly uncertain geo-political and global economic conditions, Pak-Qatar Takaful made significant progress in all areas of its operations. Since the company was in its first year of operations after getting license, the management team focused on building a solid foundation as well as developing an infrastructure, which could be used to reach out to the huge untapped market of takaful.