Takaful Oman continued its stellar performance by achieving a gross contribution of RO5.1mn for Q1 2016 compared to RO2.4mn in the corresponding period of 2015. Sayyida Rawan Ahmed Al Said, MD and CEO shares the success story of the company in an interview with Oommen John P.
Takaful Oman, the Sultanate’s first fully-fledged Islamic insurance company’s success story continues. Established two-years ago, the company achieved a gross contribution of RO5.1mn in Q1 of 2016 compared to RO2.4mn in the corresponding period of 2015 and full year contribution of RO7.7mn in 2015.
“Takaful Oman has substantially outperformed the IPO projections,”says Sayyida Rawan. And in the process, the company increased its customer base across all product offerings. Takaful Insurance has been profitable since its first full year of operations. “The profit for shareholders has crossed RO1mn. Policyholders will have to wait till the portfolio grows bigger,” says Sayyida.
Attributing the company’s performance to the strategies drawn up, she says it’s the people and the systems that are driving the company forward. The hard work that our team put in has provided the desired results. The success story started from our IPO, which we are all proud of. Several other companies in the business are now looking to replicate our model. “We are service-oriented and our products and services are the best in town.”
On the competition in the sector, she says, “We are competing with established players, who have been present for decades. We are just two years old, but we can still compete with them. The type of risk that we take is measured,” she adds.
Turning a crisis into an opportunity is what has set us apart from the competitors in the current environment. “We made use of the opportunities. The products and services that the company provides are in sync with the needs of the customers. We attained breakeven within the first year of operations, which is quite an achievement,” Sayyida avers. “We are known for our professionalism. Since the Islamic insurance has evolved just over a period of two years, we are committed to the success of the industry. We are transparent in our dealings with our customers and that has set us apart. Further, we have kept our policyholders happy and our product offerings are good. That is in essence our success story.”
Takaful Insurance has all types of products. Motor and medical are the highest contributor while there are a number of options available in the portfolio which are faring extremely well. “We cater to the needs of all types of customers.” Islamic products are not expensive as it is generally perceived, she says and adds people in general are -sensitive.
On plans to introduce new product offerings, she says: “We have to look at the requirements of the customer base that we are servicing. Out of the box thinking is the need of the hour. We will come out with innovative new products and services that are relevant for customer needs.” The company has plans to come out with a new product by the end of third quarter this year in partnership with other entities, which will be a boon for the residents and expatriates. Cost cutting is essential as everyone is looking into reducing costs. “We are trying to manage our own costs to give customers a better service through less costly products while covering their risks. The company is trying to have strategic alliances with retakaful in order to provide customers better service.”
Dwelling on the expansion plans, she says the company is determined to go ahead with its expansion plans in the country. “We will try to get our footing into every governorate. And wherever we don’t have a branch, we will serve through agencies. So it will be a combination of branches and agencies. Currently, we have our main office in Muscat and four branches serving different regions of Oman. All the agencies-related works are entrusted to SMEs to ensure the sector also grows. This way we are promoting SMEs,” says Sayyida.
On the outlook for the company, she says that there are numerous growth opportunities. In Oman, around 10 per cent of premiums are done by Islamic insurance. There is capacity for us to grow, she says. The company achieved a net profit of RO1mn attributable to shareholders for Q1, 2016 compared to RO655K for the first quarter of 2015. The company has reduced its Wakala Fees to 30 per cent for 2016 from 35 per cent for 2015. The company is carrying IBNER provision of RO389K for the Quarter. Sayyida Rawan says there is no statutory requirement to compare the IPO projections with actual performance. “Our performance is reflected in our share price. The company’s share prices have increased by over 25 per cent during the past two years,” she concludes.